10/7/09 -The European Court of Justice has found that a Spanish government tax law on gambling winnings to which the European Commission had objected, is flawed and discriminatory.
In a decision handed down on October 6 in Case number C153/08, the ECJ first chamber ruled against Spain concerning its tax exemption related to winnings.
The case was referred to the ECJ by the European Commission and concerned legalization taxing winnings from all types of lotteries, games and betting organised outside the Kingdom of Spain. However, winnings from lotteries, games and betting organised within Spain by certain not-for-profit or social welfare bodies were exempted from the tax.
The Advocate-general's conclusions were that the action should be partially accepted. By maintaining in force tax legalization that does not apply to public bodies and entities that carry out activities of a social or not-for-profit nature established in another member state and pursuing the same objectives as the Spanish entities concerned, Spain had failed to respect the freedom to provide services and infringed the principle of non-discrimination on basis of nationality, the Court found.