SpA Vinal v SpA Orbat. [1981] EUECJ R-46/80 (14 January 1981)

SpA Vinal v SpA Orbat. [1981] EUECJ R-46/80 (14 January 1981)

Differential taxation of denatured synthetic alcohol and denatured alcohol obtained by fermentation is not contrary to Article 95 EEC if the tax is applied identically to both domestic and imported products and is based on objective criteria, even if the result is that the more heavily taxed product is exclusively imported. Such arrangements are justified by legitimate economic policy objectives and do not constitute indirect protectionism if they also hinder domestic production of the more heavily taxed product.

Citation
[1981] EUECJ R-46/80
Parties
Plaintiff: SpA Vinal; Defendant: SpA Orbat
Jurisdiction
European Union
Judgment Date
14 January 1981
Procedural Posture
Preliminary Ruling / Judgment
Outcome
preliminary ruling issued
Legal Topics
Internal Taxation, Differential Taxation, Discrimination, Protectionism, Interpretation of Article 95 EEC Treaty
European Union Law Tax Law Internal Taxation Differential Taxation Discrimination Protectionism Interpretation of Article 95 EEC Treaty

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Parties

SpA Vinal

Plaintiff

SpA Orbat

Defendant

Procedural Posture

Preliminary Ruling / Judgment

Legal Issues

  1. 1 Whether differential taxation of denatured synthetic alcohol and denatured alcohol obtained by fermentation under Italian law is compatible with Article 95 of the EEC Treaty
  2. 2 Whether such taxation constitutes discrimination or protectionism against imports from other Member States

Ratio Decidendi

Differential taxation of denatured synthetic alcohol and denatured alcohol obtained by fermentation is not contrary to Article 95 EEC if the tax is applied identically to both domestic and imported products and is based on objective criteria, even if the result is that the more heavily taxed product is exclusively imported. Such arrangements are justified by legitimate economic policy objectives and do not constitute indirect protectionism if they also hinder domestic production of the more heavily taxed product.

Court Disposition

preliminary ruling issued

Orders

  • Tax arrangements imposing heavier charges on denatured synthetic alcohol than on denatured alcohol obtained by fermentation are not at variance with Article 95 EEC if applied identically to products from other Member States.
  • Such tax arrangements are justified even if the products are capable of the same uses and have the same practical application.