The European Commission (EC) announced today that it has referred Portugal to the Court of Justice of the European Union (CJEU) for taxing used cars that are imported from other EU Member States more heavily than used cars purchased on the Portuguese market.
As explained in the EC release, the Portuguese law does not fully take into account the depreciation of automobiles imported from other EU Member States and is, therefore, not compatible with Article 110 TFEU. Under EU rules, no EU Member State can impose internal taxation of any kind—whether directly or indirectly—on the products of other EU Member States in excess of that imposed directly or indirectly on similar domestic products.
The CJEU already concluded on 16 June 2016 (C-200/15) that a previous version of this Portuguese tax was contrary to EU law.
The decision to refer the matter to the CJEU comes after Portugal failed to bring its legislation into line with EU law following a “reasoned opinion.”