EC: No infringement procedure on retail-sector tax vs. Hungary

Issues

The European Commission (EC) has decided not to pursue an infringement procedure launched against Hungary in 2011 over the extraordinary tax the government imposed on retail trade companies, Hungary's National Economy Ministry announced on Friday.

The EC originally began the procedure after considering that the retail-sector tax was discriminatory because it exercised a disproportionate impact on non-Hungarian companies.

In February, the European Court of Justice (ECJ) ruled in a non-binding decision that the tax was indeed discriminatory, particularly against chain stores such as the plaintiff, the Székesfehérvár-based franchise of sporting goods retailer Hervis. Hervis was pitted against the National Tax Authority (NAV) in that case. In its ruling, the ECJ noted that combining the turnover of chain stores with the purpose of applying a progressive tax rate went against the Treaty on the Functioning of the European Union (TFEU).

Naturally, official statements from the National Economy Ministry on the decision were cheery, stating that the EC “confirms Hungary's viewpoint that the retail-sector tax did not violate European Union regulations.”

Then there's that particulate matter...
The European Commission meanwhile last week requested that Hungary take steps to comply with European Union rules on limiting citizens' exposure to fine particulate-matter pollution: “The Commission believes that Hungary has not taken measures that should have been in place since 2005 to protect citizens' health, and is asking Hungary to take forward-looking, speedy and effective action to keep the period of non-compliance as short as possible,” read an official statement in part.

The request takes the form of an “additional reasoned opinion” and follows a “letter of formal notice” sent in February 2013. If Hungary fails to act, the EC may take the matter to the European Court of Justice.

-- material from national news service MTI was used in this article

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