JUDGMENT OF 3. 7. 1974 — CASE 7/74 BROUERIUS VAN NIDEK v INSPECTEUR DER REGISTRATIE

Case 7/74 Reference to the Court under Article 177 of the EEC Treaty by the Belastingkamer (taxation chamber) of the Gerechtshof te's-Gravenhage (Court of Appeal of The Hague) for a preliminary ruling in the action pending before that court between

THE COURT composed of R. Lecourt, President, A. M. Donner, M. Sørensen, Presidents of Chambers, R. Monaco, J. Mertens de Wilmars (Rapporteur), P. Pescatore, H. Kutscher, C. Ó Dálaigh, A. J. Mackenzie Stuart, Judges, Advocate-General: G. Reischl Registrar: A. Van Houtte

gives the following

JUDGMENT

Facts

I — Facts and procedure

II — Observations submitted under Article 20 of the Statute of the Court of Justice of the European Economic Community

A — Observations of the Inspector of Registration and Succession at Rijswijk.

B — Observations of the Netherlands Government

C — Observations of the Commission

D — Observations of the Council

Law

Costs

I —. Facts and procedure

(a). Is the second paragraph of Article 13 of the Protocol on the Privileges and Immunities of the European Communities applicable to a pension granted by the European Communities to the vidow of one of their officials?

(b). If so, do the national taxes from which this pension is exempt include, in principle, death duties?

(c). If this question also must be answered in the affirmative, does the exemption also preclude the capital value of the pension right (purchase price of an annuity) from being taken into account in the assessment, or does the exemption not affect such an indirect incidence on the pension?

(d). If taxation of the capital value of a pension is not permitted, does the second paragraph of Article 13 of the Protocol extend to precluding the capital value of the pension from nevertheless being taken into account in determining the exemption to which the widow is entitled in respect of her acquisitions in so far as they do not consist of tax-free pension, in the manner prescribed in Article 32 (2) of the Netherlands Succession Law?

II —. Observations submitted under Article 20 of the Statute of the Court of Justice of the European Economic Community

A —. Observations of the Inspector of Registration and Succession at Rijswijk.

B —. Observations of the Netherlands Government

C —. Observations of the Commission

D —. Observations of the Council

1. By judgment dated 30 January 1974 the Gerechtshof te 's-Gravenhage referred to the Court four questions relating to the interpretation of the second paragraph of Article 13 of the Protocol on the Privileges and Immunities of the European Communities annexed to the Treaty establishing a Single Council and a Single Commission of the European Communities (hereinafter called the Protocol).

2. Under this provision, officials and other servants of the Communities shall be exempt from national taxes on salaries, wages and emoluments paid by the Communities.

3. The questions have been referred in order to ascertain whether, and if so to what extent, that provision must be considered in applying the Netherlands law on succession duty (Successiewet) to the survivor's pension enjoyed by the widow of an official of the European Communities.

4. The first question asks whether the second paragraph of Article 13 of the Protocol applies to a survivor's pension granted by the European Communities to the widow of one of their officials.

5. Such a pension constitutes an emolument paid by the Communities and directly derived from the statutory scheme for the remuneration of officials and other agents, of which it forms an inseparable element.

6. Regulation (Euratom, ECSC, EEC) No 549/69 of the Council, dated 25 March 1969 (OJ L 74 of 27 March 1969), issued in implementation of the above-cited second paragraph of Article 13, is accordingly quite in order in providing that the recipients of survivors' pensions should enjoy the exemption accorded by the latter provision.

7. Further, these pensions are liable to a tax on salaries, wages and emoluments for the benefit of the Communities.

8. It is therefore right to answer the first question in the affirmative.

9. The second question asks whether death duties are in principle included among the national taxes from which the survivor's pension is exempt under the second paragraph of Article 13.

10. This second paragraph cannot be read in isolation from the first, which provides that, in accordance with the conditions and procedure laid down by the Council, officials and other servants of the Communities shall be liable to a tax for the benefit of the Communities on salaries, wages and emoluments paid to them by the Communities.

11. It is as a result of this liability that the second paragraph exempts salaries, wages and emoluments from national taxes, so that the Article taken as a whole ensures a uniform treatment of the said salaries, wages and emoluments for all the officials and servants of the Communities, preventing, firstly and chiefly, their effective remuneration from differing according to their nationality or fiscal domicile as a result of the assessment of different national taxes, and secondly preventing this remuneration from being inordinately taxed as a result of double liability.

12. The exemption provided by the second paragraph of Article 13 therefore only covers national taxes of a similar nature to those levied by the Community on the same sources of, income.

13. The Community tax is a periodic tax on income whereas death duties are levied once only on an estate at the time of. transmission.

14. In these circumstances, death duties, in so far as no discrimination is made between persons entitled under officials or servants of the Communities and other taxpayers, do not constitute national taxes on salaries, wages and emoluments paid by the Communities mentioned in the second paragraph of Article 13 of the Protocol on the Privileges and Immunities.

15. In view of the answer to the second question, the third and fourth questions are purposeless.

16. The costs incurred by the Netherlands Government, the Council and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable.

17. As these proceedings are, in so far as the parties to the main action are concerned, a step in the action before the national court, costs are a matter for that court.

On those grounds, THE COURT in answer to the questions referred to it by the Gerechtshof te's-Gravenhage by judgment of that court dated 30 January 1974 hereby rules:

1 The second paragraph of Article 13 of the Protocol on the Privileges and Immunities of the European Communities applies to the survivor's pension granted to the widow of an official or other servant under the Staff Regulations of Officials and Other Servants of the Communities.

2 Death duties, in so far as no discrimination is made between persons entitled under officials or servants of the Communities and other taxpayers, do not constitute national taxes on salaries, wages and emoluments paid by the Communities mentioned in the second paragraph of Article 13 of the Protocol on the Privileges and Immunities.

1 Translator's note: Where the specific Dutch duty is referred to, the specific phrase succession duty has been adopted in preference to the general phrase death duties, although the two phrases are normally represented in the other languages by a single expression.

2 Translator's note: The phrase in parentheses is a paraphrase of the untranslatable Dutch word stamrecht.