C-387/01 Weigel

JUDGMENT OF THE COURT (Sixth Chamber)

29 April 2004 *

In Case C-387/01,

REFERENCE to the Court under Article 234 EC by the Verwaltungsgerichtshof (Austria) for a preliminary ruling in the proceedings pending before that court between

Harald Weigel,

Ingrid Weigel

and

Finanzlandesdirektion für Vorarlberg,

on the interpretation of Articles 12 EC, 23 EC, 25 EC, 39 EC and 90 EC and Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes — Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1), as amended by Council Directive 91/680/EEC of 16 December 1991 supplementing the common system of value added tax and amending Directive 77/388/EEC with a view to the abolition of fiscal frontiers (OJ 1991 L 376, p. 1),

* Language of the case: German.

THE COURT (Sixth Chamber),

composed of: V. Skouris, acting for the President of the Sixth Chamber, C. Gulmann, J.-P. Puissochet, R. Schintgen and N. Colneric (Rapporteur), Judges,

Advocate General: A. Tizzano,

Registrar: M.-F. Contet, Principal Administrator,

after considering the written observations submitted on behalf of:

— Mr and Mrs Weigel, by W. Weh, Rechtsanwalt,

— the Austrian Government, by H. Dossi, acting as Agent,

— the Danish Government, by J. Molde and J. Bering Liisberg, acting as Agents,

— the Finnish Government, by E. Bygglin, acting as Agent,

— the Commission of the European Communities, by E. Traversa and K. Gross, acting as Agents, having regard to the Report for the Hearing

after hearing the oral observations of Mr and Mrs Weigel, represented by W. Weh and W. Simmer, Rechtsanwalt; of the Austrian Government, represented by F. Sutter, acting as Agent; of the Danish Government, represented by J. Molde; of the Finnish Government, represented by T. Pynnä, acting as Agent; and of the Commission, represented by K. Gross, at the hearing on 10 April 2003,

after hearing the Opinion of the Avocate General at the sitting on 3 July 2003,

gives the following

Judgment

Grounds

1By order of 20 September 2001, received at the Court on 8 October 2001, the Verwaltungsgerichtshof (Administrative Court) referred to the Court for a preliminary ruling under Article 234 three questions on the interpretation of Articles 12 EC, 23 EC, 25 EC, 39 EC and 90 EC and Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes — Common system of value added tax: uniform basis of assessment (OJ 1977 L 145, p. 1), as amended by Council Directive 91/680/EEC of 16 December 1991 supplementing the common system of value added tax and amending Directive 77/388/EEC with a view to the abolition of fiscal frontiers (OI 1991 L 376, p. 1) ('the Sixth Directive').

2Those questions were raised in proceedings brought by Mr and Mrs Weigel against the Finanzlandesdirektion für Vorarlberg concerning the standard fuel consumption tax (Normverbrauchsabgabe, 'the NoVA') imposed on them by reason of the registration in Austria of motor vehicles belonging to them upon the transfer of their residence to that Member State.

Legal context

Community law

The provisions of the EC Treaty

3According to the first paragraph of Article 12 EC:

'Within the scope of application of this Treaty, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.'

4Article 23(1) EC provides:

'The Community shall be based upon a customs union which shall cover all trade in goods and which shall involve the prohibition between Member States of customs duties on imports and exports and of all charges having equivalent effect, and the adoption of a common customs tariff in their relations with third countries.'

5Article 25 EC is worded as follows:

'Customs duties on imports and exports and charges having equivalent effect shall be prohibited between Member States. This prohibition shall also apply to customs duties of a fiscal nature'.

6Article 39 EC stipulates:

'1. Freedom of movement for workers shall be secured within the Community.

2. Such freedom of movement shall entail the abolition of any discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment.

3. It shall entail the right, subject to limitations justified on grounds of public policy, public security or public health:

(a) to accept offers of employment actually made;

(b) to move freely within the territory of Member States for this purpose;

(c) to stay in a Member State for the purpose of employment in accordance with the provisions governing the employment of nationals of that State laid down by law, regulation or administrative action;

(d) to remain in the territory of a Member State after having been employed in that State, subject to conditions which shall be embodied in implementing regulations to be drawn up by the Commission.

4. The provisions of this article shall not apply to employment in the public service.'

7The first paragraph of Article 90 EC is in the following terms:

'No Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic products.'

Secondary law

8Article 2 of the Sixth Directive provides:

'The following shall be subject to value added tax:

1. the supply of goods or services effected for consideration within the territory of the country by a taxable person acting as such;

2. the importation of goods'.

9Article 17 of the Sixth Directive confers a right in specified cases to deduct value added tax ('VAT') paid on inputs.

10Article 33(1) of the Sixth VAT Directive is in the following terms:

'Without prejudice to other Community provisions, in particular those laid down in the Community provisions in force relating to the general arrangements for the holding, movement and monitoring of products subject to excise duty, this Directive shall not prevent a Member State from maintaining or introducing taxes on insurance contracts, taxes on betting and gambling, excise duties, stamp duties and, more generally, any taxes, duties or charges which cannot be characterised as turnover taxes, provided however that those taxes, duties or charges do not, in trade between Member States, give rise to formalities connected with the crossing of frontiers'.

11Council Directive 83/183/EEC of 28 March 1983 on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals (OJ 1983 L 105, p. 64) has as its purpose the elimination of obstacles to the free movement of persons within the European Community. Article 1 of the directive defines its scope as follows:

'1. Every Member State shall, subject to the conditions and in the cases hereinafter set out, exempt personal property imported permanently from another Member State by private individuals from turnover tax, excise duty and other consumption taxes which normally apply to such property.

2. Specific and/or periodical duties and taxes connected with the use of such property within the country, such as for instance motor vehicle registration fees, road taxes and television licences, are not covered by this Directive'.

12Article 2 of Council Regulation (EEC) No 918/83 of 28 March 1983 setting up a Community system of reliefs from customs duty (OJ 1983 L 105, p. 1) provides that, subject to Articles 3 to 10 of the regulation, personal property imported by natural persons transferring their normal place of residence from a third country to the customs territory of the Community shall be admitted free of import duties.

National law

13The Abgabenänderungsgesetz 1991 (Tax Amendment Law of 1991, BGBl. 695/1991) introduced the Normverbrauchsabgabegesetz (Law on Standard Fuel Consumption Tax, 'the NoVAG') into Austrian law. According to Paragraph 15 (1) of that Law, as amended in 1995 (BGBl. 21/1995) and 1996 (BGBl. 201/1996), it applies to events occurring after 31 December 1991.

14Paragraph 1 of the No VAG provides:

'The following transactions shall be subject to the No VA:

1. the supply for consideration in the national territory by a trader ... in the course of his business of vehicles not previously registered there and of demonstration vehicles ... ;

2. the commercial hiring out in the national territory of vehicles not previously registered there ... ;

3. the first-time registration in the national territory of vehicles, other than demonstration vehicles, where a charge to tax has not already been incurred under subparagraphs 1 or 2 or where reimbursement has taken place under Paragraph 12(1) after a charge to tax was incurred;

…'.

15Under Paragraph 1(4) of the No VAG, the supply, transfer from business to personal use ('Eigenverbrauch durch Entnahme'), and change in use of vehicles exempt under Paragraph 3(3) in particular are made subject to the NoVA.

16Under Paragraph 2(1) and (2) of the NoVAG, motor vehicles comprise motor cycles and motor cars within the more specified tariff classification headings of the Combined Nomenclature.

17Under Paragraph 4(1) of the NoVAG, the person chargeable to the NoVA in the cases of supply (Paragraph 1(1) and (4)), commercial hiring out (Paragraph 1(2)), transfer to personal use and change in use (Paragraph 1(4)) is the trader carrying out the supply or commercial hiring out or one of the other acts referred to in Paragraph 1(4). Paragraph 4(2) provides that the chargeable person in the case of a first-time registration (Paragraph 1(3)) is the person in whose name the vehicle is registered.

18Under Paragraph 5 of the NoVAG, the chargeable value for NoVA purposes is determined as follows:

'(1) In the case of supply (Paragraph 1(1) and (4)), the NoVA shall be assessed on the consideration paid, as defined by Paragraph 4 of the UStG (Umsatzsteuergesetz) 1972 [Law on Turnover Tax of 1972].

(2) In all other cases (Paragraph 1(2), (3) and (4)), it shall be assessed on the fair market value of the vehicle, exclusive of VAT.

(3) The NoVA shall not be included in the chargeable value'.

19In 2000, the following sentence was added to Paragraph 5(2) of the NoVAG (BGBl. I 142/2000):

'In the case of an intra-Community acquisition of a vehicle from an authorised dealer, the purchase price shall be deemed to be the fair market value of the vehicle.'

20According to Paragraph 10(2) of the Bewertungsgesetz 1955 (Valuation Law of 1955, BGBl. 148/1955, 'the BewG'), the fair market value of a vehicle is the price a vehicle in its condition would sell for in the ordinary course of business.

21Paragraph 5.2 of the Circular of 1 September 1995 amending the NoVA guidelines, issued by the Austrian Federal Ministry of Finance (Federal Ministry of Finance, Section IV, GZ 14 0609/8 IV/11/95, 'the circular of 1 September 1995'), adds the following details concerning the calculation of the NoVA:

'5.2 — Fair market value:

In all cases where the charge to tax does not arise as a result of a supply (e.g. leasing, private import, change of circumstances through change in use, transfer to personal use), the chargeable value is the fair market value exclusive of VAT and NoVA (see Paragraph 5(3) of the NoVAG). The fair market value is determined in accordance with Paragraph 10 of the BewG and takes into account the taxable person's position in the supply chain ....

The following computation methods apply:

5.2.1 Intra-community import:

Fair market value is based on the domestic Eurotax valuations. It is the mean of the dealer's purchase and selling price (excluding VAT and NoVA). That mean corresponds, broadly speaking, to the price that the imported vehicle would achieve if sold privately in the national territory (= the private sale price within the meaning of Paragraph 10 of the BewG). The fair market value may differ from that value in the specific circumstances, because of differences in the terms of warranty coverage and after-sales service, repairs that may be required, features, and wear-and-tear. The price paid for the car in its country of origin may be taken as the fair market value for NoVA purposes if it is within 20% of the Eurotax mean valuation. If it lies outside that range, the taxable person has to substantiate the reason for the discrepancy.'

22The rate at which the NoVA is charged is governed by Paragraph 6 of the No VAG. The plaintiffs in the main proceedings were assessed at the surcharged rate provided for by paragraph 6 of that Paragraph.

23Paragraph 6 of the NoVAG provides:

'(1) ...

(2) The rate for other motor vehicles shall be 2% multiplied by the fuel consumption in litres reduced by 3 litres (2 litres in the case of diesel vehicles), to be measured by overall consumption on the MVEG (Motor Vehicles Emissions Group) Cycle in accordance with Directive 80/1268, as amended by Directive 93/116. Where average consumption is not more than 3 litres (2 litres in the case of diesel vehicles) the rate shall be 0%.

(3) The resulting rates shall be rounded up or down to the nearest whole percentage. The rate shall not exceed 16% of the basis of assessment.

(6) The tax shall be increased by 20% where the NoVA is not included in the chargeable value for VAT purposes.'

24Paragraph 7(1)(3) of the NoVAG provides that in the cases covered by Paragraph 1(3) the tax liability is incurred on the date of registration.

25According to the transitional provision contained in the first sentence of Paragraph 15(2) of the NoVAG, a first-time registration in the national territory is not subject to the NoVA where a vehicle has incurred VAT at the rate of 32% upon a supply or importation and the purchaser or importer is not entitled to deduct input VAT.

The main proceedings

26Mr and Mrs Weigel, the plaintiffs in the main proceedings, are German nationals who transferred their residence to Austria in mid-1996. Mr Weigel, who had previously been working in Germany, was at that time appointed director of the Vorarlberger Landesbibliothek. Up to the birth of their child, his wife, Mrs Weigel, had also been working in Germany.

27Mr and Mrs Weigel each imported a car into Austria as personal property. After moving residence, they were required to register the cars in that Member State. Having complied with that requirement, Mr and Mrs Weigel received No VA assessments by decisions of the Finanzamt (Tax Office) Feldkirch of 2 October 1996, with Mr Weigel's vehicle being assessed for ATS 31 416 and that of his wife for ATS 7 668.

28The tax charged to Mr Weigel was in respect of a 1995 Mitsubishi Space Wagon GLXi. That vehicle had a Eurotax valuation of ATS 187 000, which was taken as the chargeable value for No VA purposes. Applying a rate of 14%, a charge of ATS 26 180 was assessed ('the base tax'). A surcharge of 20% of the base tax, amounting to ATS 5 236, was then applied, bringing the total charge to tax to ATS 31 416.

29The tax charged to Mrs Weigel was in respect of a 1993 Nissan Sunny Y10 L2. That vehicle had a Eurotax valuation of ATS 71 000, which was taken as the chargeable value for No VA purposes. Applying a rate of 9%, a charge of ATS 6 390 was assessed for the base tax. A surcharge of 2 0% of the base tax, amounting to ATS 1 278, was subsequently applied, bringing the total charge to tax to ATS 7 668.

30On appeal by Mr and Mrs Weigel, the Finanzlandesdirektion für Vorarlberg upheld the No VA assessments made by the Finanzamt, relying on the existence of the taxable event contemplated by Paragraph 1(3) of the NoVAG.

31The Weigels challenged those decisions before the Verfassungsgerichtshof (Austrian Constitutional Court). That court declined to hear the case and, upon the plaintiffs' application, remitted the case to the Verwaltungsgerichtshof.

The order for reference and the questions referred

32The Verwaltungsgerichtshof states that the NoVA is a policy measure to encourage the purchase of low-fuel vehicles. What distinguishes the present case, which concerns Paragraph 1(3) of the NoVAG, is the fact that the chargeable event was the importation of cars by nationals of another Member State of the European Union when transferring their residence to Austria in connection with a change of place of work.

33Having noted that the NoVA is normally included in the chargeable value for VAT purposes, the Verwaltungsgerichtshof points out that the surcharge provided for in Paragraph 6(6) of the NoVAG was introduced in order to compensate for a VAT undercharge that arises where the NoVA is not included in the chargeable value for VAT purposes. That happens in particular in the case of imported cars, where VAT is collected on importation, at which point the chargeable value for VAT purposes does not yet include the NoVA, since the charge to the NoVA arises, according to Paragraph 1(3) of the NoVAG, only when the cars are subsequently registered.

34In relation to its first question, the Verwaltungsgerichtshof rejects the claims of Mr and Mrs Weigel that they were discriminated against. It states that a worker changing residence within Austria who purchased a vehicle which had not previously been registered in that Member State would have to pay both the No VA and VAT. The referring court accepts, however, that a worker moving to Austria from another Member State is not in the same position as an Austrian national, since the latter, unlike the former, has the option, when buying a car, of choosing a model with lower fuel consumption and thereby incurring a lower charge to the No VA.

35The Verwaltungsgerichtshof also considers it possible that the imposition of an additional tax on an imported car, charged solely because of the purchaser's work-related transfer of residence, might be considered to be a breach of Article

39 EC.

36As to the second question, the Verwaltungsgerichtshof takes the view that both the No VA and the surcharge constitute a pecuniary charge that is part of a general system of internal taxation, which would rule out any breach of Articles 23 EC and 25 EC. However, since in practice the surcharge affects mainly transactions relating to goods crossing borders, the Verwaltungsgerichtshof believes that it may perhaps be regarded as a charge having equivalent effect [to a customs duty] contrary to those provisions.

37In relation to Article 90 EC, the Verwaltungsgerichtshof is uncertain as to whether, firstly, the use of fair market value on the domestic market takes due account of the judgments in Case C-47/88 Commission v Denmark [1990] ECR I-4509 and Case C-345/93 Nunes Tadeu [1995] ECR I-479. Secondly, given that, in the case of the surcharge, no provision has been made for the deduction of input tax, the referring court takes the view that imported cars are taxed more heavily where the consignee is an undertaking having a right of deduction. In the light, for example, of the judgment in Case C-265/99 Commission v France [2001] ECR I-2305, paragraph 40, the surcharge might thus be incompatible with Article 90 EC.

38In relation to the third question, the Verwaltungsgerichtshof notes that the creation of the single market and the adoption of Directive 91/680 first and foremost did away with turnover tax on imports as between Member States. If the surcharge is designed to replace the turnover tax that would otherwise be due on imports, it could be contrary to the provisions of the Sixth Directive.

39In the light of those considerations, the Verwaltungsgerichtshof stayed the proceedings and referred the following questions to the Court for a preliminary ruling:

'1. Is Article 39 EC (free movement of workers) or Article 12 EC (discrimination on the ground of nationality) to be interpreted as meaning that it is contrary to those provisions for a standard fuel consumption tax (Normverbrauchsabgabe, base tax and surcharge) to be charged on a vehicle brought into the Republic of Austria from another Member State of the Community by a person moving residence in connection with a change of place of work?

2. Do Article 90 EC (prohibiting higher taxation on goods from other Member States) or Article 23 EC (customs union) and Article 25 EC (prohibition of customs duties or charges having equivalent effect between the Member States) preclude the imposition of the standard fuel consumption tax referred to in the first question (base tax or surcharge)?

3. Is the surcharge payable as part of the Normverbrauchsabgabe referred to in the first question compatible with the Sixth Directive ... as amended by Council Directive 91/680/EEC ...?'

The questions referred

40The first point to be noted is that, as set out in the grounds of the order for reference, the consumption tax at issue in the main proceedings consists of a base tax ('the NoVA base tax') and a potential surcharge ('the 20% surcharge'). The latter, the referring court explains, is intended to make up for the fact that no VAT is charged on the vehicle concerned where the operative event is one that is not subject to VAT, in particular the first-time registration of the vehicle in Austria.

41The first and second questions each comprise two parts, the first part concerning the NoVA base tax and the second the 20% surcharge.

The NoVA base tax

The first part of the first question

42By the first part of its first question, the referring court asks essentially whether Article 39 EC or Article 12 EC preclude the imposition of a consumption tax such as the No VA base tax at issue in the main proceedings on a private individual from one Member State who on taking up residence in another Member State because of a change of place of work imports his or her car into the latter State.

43Before examining whether the imposition of a tax having the characteristics of the No VA base tax may constitute a breach of Article 39 EC and Article 12 EC, it is necessary to consider that measure in the light of the provisions of Directive 83/183. As the Commission of the European Communities rightly observed, there is no need to consider whether there has been a breach of the Treaty rules in question if a provision of that directive already precludes the charging of a tax such as the NoVA base tax on individuals in the position of Mr and Mrs Weigel.

44The fact that the question of the application of Directive 83/183 was canvassed only by Mr and Mrs Weigel and by the Commission and was not actually submitted to the Court by the national court does not prevent the Court from considering it. Even though, strictly speaking, the national court has directed its question solely to the interpretation of Articles 39 EC and 12 EC, the Court is not thereby precluded from providing the national court with all those elements for the interpretation of Community law which may be of assistance in adjudicating on the case pending before it, whether or not that court has specifically referred to them in its questions (see, to that effect, Case C-241/89 SARPP [1990] ECR I-4695, paragraph 8, Case C-315/92 Verband Sozialer Wettbewerb ('Clinique'') [1994] ECR I-317, paragraph 7, and Case C-87/97 Consorzio pel la tutela del formaggio Gorgonzola [1999] ECR I-1301, paragraph 16).

— Directive 83/183

45According to the Commission, with which Mr and Mrs Weigel agree in substance, the NoVA base tax is prohibited by Article 1(1) of Directive 83/183, at least in so far as it exceeds the administrative cost of registering the vehicle. The exemption prescribed by that provision covers not only taxes levied directly on imports of property but also taxes on processes that are intimately linked to the importation, such as the registration of a motor vehicle. The Commission takes the view that Article 1(2) of the directive, which excludes 'motor vehicle registration fees' from the exemption, does not apply to the No VA base tax. The exception contained in that provision must be strictly construed. The term 'registration fee', in particular, should comprise only fees intended to cover the costs of registration. The Commission cites both the French version, which refers to 'droits perçus lors de '

l'immatriculation' rather than 'taxes perçues lors de l'immatriculation, and the English version, which refers to 'fees', a term applicable only to charges other than taxes.

46The Commission's argument that Article 1(1) of Directive 83/183 applies to the No VA base tax cannot be upheld.

47A tax such as the No VA base tax must be regarded as falling outside the scope of the exemption in Article 1(1) of Directive 83/183. That provision concerns certain specified types of charge which normally apply to property imported permanently. Contrary to what the Commission submits, a consumption tax, such as the No VA base tax, cannot be regarded as a tax linked to importation as such. The first four subparagraphs of Paragraph 1 of the No VAG read together show that the operative event giving rise to the No VA is not importation. In the case of subparagraph 3, which is at issue in the main proceedings, the operative event attracting the No VA is first-time registration in the State, which is not necessarily linked to the act of importation.

48Given that a tax having the characteristics of the No VA base tax is not one that comes within the exemption provided for in Article 1(1) of Directive 83/183 and that, accordingly, no exemption can be granted in application of that directive, it is not necessary to decide whether such a tax is excluded from the scope of the directive by Article 1(2).

49It follows that Directive 83/183 does not preclude the imposition of a tax such as the No VA base tax on a private individual from one Member State who on taking up residence in another Member State because of a change of place of work imports his or her car into the latter State.

— Article 39 EC

50Article 39(2) EC expressly provides that the free movement of workers requires the abolition of all discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment.

51According to the case-law of the Court, Article 39 EC also prohibits national rules which, although they apply without regard to the nationality of the workers concerned, constitute an obstacle to their freedom of movement (see Case C-415/93 Bosman [1995] ECR I-4921, paragraph 96).

52The provisions of the Treaty relating to freedom of movement for persons are intended to facilitate the pursuit by Community citizens of occupational activities of all kinds throughout the Community, and preclude measures which might place Community citizens at a disadvantage when they wish to pursue an economic activity in the territory of another Member State (see, in particular, Bosman, cited above, paragraph 94, Case C-18/95 Terhoeve [1999] ECR I-345, paragraph 37, and Case C-190/98 Graf [2000] ECR I-493, paragraph 21).

53A rule such as that at issue in the main proceedings applies without regard to the nationality of the worker concerned to all those who register a car in Austria and, accordingly, it is applicable without distinction.

54It is true that it is likely to have a negative bearing on the decision of migrant workers to exercise their right to freedom of movement.

55However, the Treaty offers no guarantee to a worker that transferring his activities to a Member State other than the one in which he previously resided will be neutral as regards taxation. Given the disparities in the legislation of the Member States in this area, such a transfer may be to the worker's advantage in terms of indirect taxation or not, according to circumstance. It follows that, in principle, any disadvantage, by comparison with the situation in which the worker pursued his activities prior to the transfer, is not contrary to Article 39 EC if that legislation does not place that worker at a disadvantage as compared with those who were already subject to it (see, in relation to social security, Joined Cases C-393/99 and C-394/99 Hervein and Others [2002] ECR I-2829, paragraph 51).

56On the basis of the evidence before the Court, such is the case in the main proceedings.

— Article 12 EC

57Article 12 EC, which enshrines the general principle that there can be no discrimination on grounds of nationality, applies independently only to situations governed by Community law in respect of which the Treaty lays down no specific prohibition of discrimination (see Case C-100/01 Oteiza Olazabal [2002] ECR I-10981, paragraph 25, and Case C-289/02 AMOK [2003] ECR I-15059, paragraph 25).

58As far as the free movement of workers is concerned, that principle is implemented and given specific effect by Article 39 EC.

59There is therefore no need to express a view on Article 12 EC in so far as the facts at issue in the main proceedings fall within the scope of Article 39 EC.

60Accordingly, the answer to be given to the first part of the first question is that Articles 39 EC and 12 EC do not preclude the imposition of a consumption tax such as the No VA base tax at issue in the main proceedings on a private individual from one Member State taking up residence in another Member State because of a change of place of work and importing his or her car into the latter State in so doing.

The first part of the second question

61By the first part of the second question, the referring court is in effect submitting two separate questions to the Court, asking first whether the NoVA base tax constitutes a customs duty or a charge having equivalent effect, within the meaning of Articles 23 EC and 25 EC and secondly whether, and if so to what extent, that tax constitutes discriminatory internal taxation contrary to Article 90 EC.

62It should be noted at the outset that, contrary to what Mr and Mrs Weigel claim, Regulation No 918/83, by virtue of Article 2, has no application to the main proceedings. The scope of that regulation comprises only personal property imported by natural persons transferring their normal place of residence to the customs territory of the Community. Mr and Mrs Weigel, however, moved from the Member State where they lived to another Member State.

63Also, as far as the respective spheres of application of Articles 25 EC and 90 EC are concerned, the Court has consistently held that provisions relating to charges having equivalent effect and those relating to discriminatory internal taxation cannot be applied together, with the result that, under the system established by the Treaty, the same charge cannot belong to both categories at the same time (see Case C-234/99 Nygård [2002] ECR I-3657, paragraph 17, Case C-101/00 Tulliasiamies and Siilin [2002] ECR I-7487, paragraph 115, and Case C-383/01 De Danske Bilimportører [2003] ECR I-6065, paragraph 33).

— Articles 23 EC and 25 EC

64The Court has consistently held (see, in particular, Case C-90/94 Haahr Petroleum [1997] ECR I-4085, paragraph 20, and Case C-213/96 Outokumpu [1998] ECR I-1777, paragraph 20) that any pecuniary charge, whatever its designation and mode of application, which is imposed unilaterally on goods by reason of the fact that they cross a border, and which is not a customs duty in the strict sense, constitutes a charge having equivalent effect within the meaning of Articles 23 EC and 25 EC. However, such a charge may not be so characterised if it forms part of a general system of internal dues applying systematically to categories of products according to objective criteria applied without regard to the origin of the products, in which case it falls within the scope of Article 90 EC (see, to that effect, Nygård, paragraph 19).

65In the present case, the No VA base tax is manifestly of a fiscal nature and it is charged not by reason of the vehicle crossing the border of the Member State which established it, but in view of other operative events, of which first-time registration of the vehicle in that State is one. It must therefore be regarded as part of a general system of internal dues on goods and hence examined in the light of Article 90 EC (see, to that effect, De Danske Bilimportører, paragraph 34).

— Article 90 EC

66As far as the taxation of imported used cars is concerned, the Court has held that Article 90 EC seeks to guarantee the complete neutrality of internal taxation as regards competition between products already on the domestic market and imported products (see, to that effect, Commission v Denmark, paragraph 9, Nunes Tadeu, paragraph 18, and Tulliasiamies and Siilin, paragraph 52).

67According to settled case-law, the first paragraph of Article 90 EC is infringed where the tax charged on the imported product and that charged on the similar domestic product are calculated in a different manner on the basis of different criteria which lead, if only in certain cases, to higher taxation being imposed on the imported product (see Case C-375/95 Commission v Greece [1997] ECR I-5981, paragraphs 20 and 29, Outokumpu, paragraph 34, and Case C-393/98 Gomes Valente [2001] ECR I-1327, paragraph 21).

68A comparison between the tax treatment of imported used vehicles, such as those at issue in the main proceedings, and that of used cars bought locally, which constitute similar or competing products, shows that the No VA base tax is charged on both those categories of vehicle without distinction. While it is true that somebody buying a used vehicle already registered in Austria does not pay the No VA base tax directly, the fact remains that the price paid for the vehicle already includes a residual portion of the No VA base tax, which reduces in line with the vehicle's depreciation through use.

69However, the tax burden on both categories of used car is the same only if the amount of a consumption tax such as the No VA base tax charged on used cars from another Member State does not exceed the amount of the residual No VA base tax incorporated in the value of a similar used car already registered in the State (see, to that effect, Nunes Tadeu, paragraph 20, and Gomes Valente, paragraph 23).

70In that regard, the Court has held that it is contrary to the first paragraph of Article 90 EC to charge tax on imported used motor vehicles based on a value which is higher than the real value of the vehicle with the result that they are taxed more heavily than similar used cars on the domestic market (see, to that effect, Commission v Denmark, cited above, paragraph 22). It is therefore necessary, in taxing imported used cars, to take account of their actual depreciation.

71To avoid discriminatory taxation, the taxable value imputed to the imported used vehicle by the revenue authorities should faithfully reflect the value of a similar used vehicle already registered on the domestic market.

72According to the documents before the Court, in particular the circular of 1 September 1995, the taxable value imputed to imported used vehicles by the Austrian revenue authorities for the purposes of the No VA base tax is their fair market value. That is a set value based on Eurotax ratings and, as a general rule, it corresponds to the price the imported vehicle would achieve in a private sale on the domestic market.

73With regard to such a valuation process, the Court has acknowledged that although the actual depreciation of the vehicles cannot be taken into account otherwise than by means of an assessment or expert examination of each of them, to avoid the administrative burden inherent in such a system, a Member State may establish, by means of fixed scales determined by statute, regulation or administrative provision and calculated on the basis of criteria such as a vehicle's age, mileage, general condition, fuel type, make or model, a value for second-hand vehicles which, as a general rule, is very close to their actual value (Gomes Valente, paragraph 24).

74The Court has also accepted that in drawing up those scales, the authorities of a Member State may refer to a guide indicating the average prices of second-hand vehicles in the national market or to a list of average current prices used as a reference in the sector (Gomes Valente, paragraph 25).

75To avoid any discrimination, the set values based on the Eurotax rates must reflect the actual depreciation of vehicles precisely and produce the desired outcome that the tax charged on imported second-hand vehicles in no case exceeds the amount of the residual tax incorporated in the value of similar second-hand vehicles already registered in the State.

76It is for the national court to determine whether the fair market valuation method satisfies the conditions set out in the previous paragraph.

77Disputing that the No VA base tax is calculated on the basis of fair market value, Mr and Mrs Weigel submit, inter alia, that second-hand car prices were lower in Germany than in Austria. Referring to paragraph 18 of the Nunes Tadeu judgment, cited above, they argue in particular that the tax in question eliminates the competitive advantage which those vehicles would hold on the Austrian market in its absence.

78In that regard, it should be observed that the Court has already held that a national tax system which is liable to eliminate a competitive advantage held by imported products over domestic products would be manifestly incompatible with Article 90 EC (Nunes Tadeu, paragraph 18).

79However, the documents before the Court, in particular the circular of 1 September 1995, show that the fair market value is a set value that corresponds, broadly speaking, to the price the imported vehicle would achieve on the domestic market. Consequently, the No VA base tax charged on imported used cars tends to correspond to the residual No VA incorporated in the value of used cars already registered in the State.

so Accordingly, a consumption tax such as the No VA base tax at issue in the main proceedings cannot prevent a trader taking advantage of the price differences between second-hand cars in the Member States.

81It follows from the above considerations that the answer to be given to the first part of the second question is that:

— a consumption tax such as the NoVA base tax at issue in the main proceedings constitutes internal taxation of which the compatibility with Community law must be examined not under Articles 23 EC and 25 EC but under Article 90 EC,

— Article 90 EC must be interpreted as meaning that it does not preclude a consumption tax such as the NoVA base tax at issue in the main proceedings to the extent that the charges to that tax precisely reflect the actual depreciation of second-hand vehicles imported by private individuals and produce the desired outcome that the tax charged on imported second-hand vehicles in no case exceeds the amount of the residual tax incorporated in the value of similar second-hand vehicles already registered in the State.

The 20% surcharge

The second part of the second question

82With regard to the 20% surcharge referred to in Article 6(6) of the No VAG, the second part of the second question is best considered first.

— Articles 23 EC and 25 EC

83The file shows that the 20% surcharge applies only in very exceptional circumstances to purely domestic events. However, it should be recalled that a charge which is imposed on both imported products and domestic products but in practice applies almost exclusively to imported products because domestic production is extremely small does not constitute a charge having an effect equivalent to a customs duty on imports within the meaning of Articles 23 EC and 25 EC if it is part of a general system of internal dues applied systematically to categories of products in accordance with objective criteria irrespective of the origin of the products. It therefore constitutes internal taxation within the meaning of Article 90 EC (Case 193/85 Cooperativa Co-Frutta [1987] ECR 2085, paragraph 14, and Case C-343/90 Lourenço Dias [1992] ECR I-4673, paragraph 53).

84The same is true of the 20% surcharge. Therefore, a tax of that kind must be examined not under Articles 23 EC and 25 EC but under Article 90 EC.

— Article 90 EC

85Community law does not as yet restrict the freedom of each Member State to establish a tax system which differentiates between certain products, even products which are similar within the meaning of the first paragraph of Article 90 EC, on the basis of objective criteria. Such differentiation is compatible with Community law, however, only if it pursues objectives of economic policy which are themselves compatible with the requirements of the Treaty and secondary legislation, and if the detailed rules are such as to avoid any form of discrimination, direct or indirect, against imports from other Member States or any form of protection of competing domestic products (see, to this effect, Case 196/85 Commission v France [1987] ECR 1597, paragraph 6, and Outokumpu, paragraph 30).

86Consequently, the Court has already held that a criterion for charging higher taxation which by definition can never be fulfilled by similar domestic products cannot be considered to be compatible with the prohibition of discrimination laid down in Article 90 EC. Such a system has the effect of excluding domestic products in advance from the heaviest taxation (Case 319/81 Commission v Italy [1983] ECR 601, paragraph 17). Likewise, the Court has held that such differential taxation is incompatible with Community law if the products most heavily taxed are, by their very nature, imported products (Case 106/84 Commission v Denmark [1986] ECR 833, paragraph 21).

87The 20% surcharge is generally assessed only on the NoVA base tax charged on imported second-hand vehicles and it applies only in exceptional circumstances to the NoVA base tax charged on purely domestic transactions. In so far as the purpose of the 20% surcharge is to prevent supposed distortions of competition, it must be remembered that a tax aimed at eliminating a competitive advantage held by imported products over domestic products would be manifestly contrary to Article 90 EC.

88Accordingly, it must be found that a tax such as the 20% surcharge is incompatible with Article 90 EC.

89Consequently, the answer to be given to the second part of the second question is that Article 90 EC must be interpreted as meaning that it precludes the imposition of a 20% surcharge, in the case of the importation by a private individual of a second-hand car from another Member State, on a tax having the characteristics of the No VA base tax at issue in the main proceedings.

The second part of the first question and the third question

90In the light of the answer given to the second part of the second question, there is no need to reply to the second part of the first question or the third question.

Costs

Costs

91The costs incurred by the Austrian, Danish and Finnish Governments and by the Commission, which have submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step in the proceedings pending before the national court, the decision on costs is a matter for that court.

Operative part

On those grounds,

THE COURT (Sixth Chamber),

in answer to the questions referred to it by the Verwaltungsgerichtshof by order of 20 September 2001, hereby rules:

1. Articles 39 EC and 12 EC do not preclude the imposition of a consumption tax such as the Normverbrauchsabgabe base tax at issue in the main proceedings on a private individual from one Member State who on taking up residence in another Member State because of a change of place of work imports his or her car into the latter State.

2. A consumption tax such as the Normverbrauchsabgabe base tax at issue in the main proceedings constitutes internal taxation of which the compatibility with Community law must be examined not under Articles 23 EC and 25 EC but under Article 90 EC.

3. Article 90 EC must be interpreted as meaning that it does not preclude a consumption tax such as the Normverbrauchsabgabe base tax at issue in the main proceedings to the extent that the charges to that tax precisely reflect the actual depreciation of second-hand vehicles imported by private individuals and produce the desired outcome that the tax charged on imported second hand vehicles in no case exceeds the amount of the residual tax incorporated in the value of similar second-hand vehicles already registered in the State.

4. Article 90 EC must be interpreted as meaning that it precludes the imposition of a 20% surcharge, in the case of the importation by a private individual of a second-hand car from another Member State, on a tax having the characteristics of the Normverbrauchsabgabe base tax at issue in the main proceedings.

Skouris Gulmann Puissochet

Schintgen Colneric

Delivered in open court in Luxembourg on 29 April 2004.

R. Grass

V. Skouris

Registrar President

OPINION OF ADVOCATE GENERAL TIZZANO delivered on

Introduction

1By order of 20 September 2001, the Austrian Verwaltungsgerichtshof (Administrative Court; 'the Verwaltungsgerichtshof') referred to the Court for a preliminary ruling under Article 234 EC three questions by which the referring court asks, in substance, whether Articles 12 EC, 23 EC, 25 EC, 39 EC and 90 EC or the Community VAT directives preclude national rules imposing a registration tax based on fuel consumption on a vehicle imported from another Member State if those rules are applied to the private vehicle of a taxable person moving residence from one Member State to another for reasons of work.

I — Legislative background

A — Community law

The Treaty provisions

2Article 12 EC lays down a general prohibition of discrimination on grounds

3 July 2003

of nationality within the field of application of the Treaty. That principle is then given effect, inter alia, in Article 39 EC, according to which the free movement of workers within the Community requires the abolition of all discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment.

3Articles 23 and 25 EC, which regulate the operation of the customs union, prohibit the imposition, in trade between Member States, of customs duties on imports and of all charges having equivalent effect.

4This prohibition is backed up by Article 90(1) EC, by virtue of which no Member State shall impose, directly or indirectly, on the products of other Member States any internal taxation of any kind in excess of that imposed on similar domestic products. Secondary law

The VAT rules

5According to Article 2 of Council Directive 77/388/EEC ('the Sixth VAT Directive'), 2 the following are subject to value added tax:

'1. the supply of goods or services effected for consideration within the territory of the country by a taxable person acting as such;

2. the importation of goods'.

6Article 33(1) of the Sixth VAT Directive is in the following terms:

'Without prejudice to other Community provisions, in particular those laid down in the Community provisions in force relating to the general arrangements for the holding, movement and monitoring of products subject to excise duty, this Directive shall not prevent a Member State from maintaining or introducing taxes on insurance contracts, taxes on betting and gambling, excise duties, stamp duties and, more generally, any taxes, duties or charges which cannot be characterised as turnover taxes, provided however that those taxes, duties or charges do not, in trade between Member States, give rise to formalities connected with the crossing of frontiers'.

The exemption rules

7Council Directive 83/183/EEC of 28 March 1983 on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals ('Directive 83/183'), 3 has as its purpose the elimination of tax obstacles that hinder the free movement of persons within the Community. Article 1 of the directive defines its scope as follows:

'1. Every Member State shall, subject to the conditions and in the cases hereinafter set out, exempt personal property imported permanently from another Member State by private individuals from turnover tax, excise duty and other consumption taxes which normally apply to such property.

2. Specific and/or periodical duties and taxes connected with the use of such property within the country, such as for instance motor vehicle registration fees, road taxes and television licences, are not covered by this Directive'.

The national legislation

8The Normverbrauchsabgabegesetz (Law imposing a Standard Fuel Consumption Tax, 'the No VAG') 4i ntroduced the Norm-verbrauchsabgabe, a tax on the standard fuel consumption of motor vehicles ('the NoVA'). The charge to the No VA arises upon the supply of a motor vehicle that has not yet been registered in Austria (Paragraph 1(1) of the No VAG), upon the commercial hiring out of such a vehicle (Paragraph 1(2) of the NoVAG) or, in all other cases, upon the first-time registration of a motor vehicle in Austria (Paragraph 1(3) of the NoVAG).

9The party liable for the tax is the supplier or lessor respectively in the case of a supply or a commercial hiring out (Paragraph 4(1) of the NoVAG), while in the case of a first-time registration it is the person in whose name the motor vehicle has been registered (Paragraph 4(2) of the NoVAG).

10The basis of assessment of the tax is set forth in Paragraph 5 of the NoVAG and is defined, in the case of a supply, as the value of the motor vehicle, calculated in accordance with Paragraph 4 of the Umsatzsteuergesetz (Turnover Tax Law).

11In all other cases, the basis of assessment is the fair value of the vehicle, exclusive of VAT. In the case of an intra-Community import, that value is normally computed by reference to the national Eurotax valuations; 5i t is thus, in effect, the mean of the purchase and selling price (exclusive of VAT and the NoVA), corresponding, in general, to the price that could be obtained from a private sale in the country of origin of the imported vehicle.

12The fair value of the motor vehicle, for NoVA purposes, may be greater or less than the Eurotax mean value to take into account the terms of the warranty and after-sales service, any repairs required, the vehicle's features, and wear-and-tear.

13The purchase price abroad may be deemed to be the fair value on which the NoVA is based if it does not differ from the Eurotax mean valuation by more than 20%. If it does, the taxpayer is required to explain in each case the difference of over 20% from the mean valuation.

14Under Paragraph 6(2) of the NoVAG, the tax rate for motor vehicles varies according to fuel consumption and is equal to the fuel consumption rating, in litres, reduced by three litres (or two litres, in the case of diesel vehicles) and multiplied by two. Paragraph 6(3) of the NoVAG provides that the rate may not in any case exceed 16% of the basis of assessment.

15Under Paragraph 6(6) of the NoVAG, where the chargeable event is not subject to VAT in Austria and the VAT amount is thus not included in the basis of assessment of the NoVA, a surcharge of 20% of the base tax applies.

16In substance, therefore, the NoVA comprises a base tax ('the NoVA base tax') and a potential surcharge ('the NoVA surcharge'), which is suffered where the chargeable event is not the supply of the vehicle but some other event not subject to VAT, including, in particular, the first-time registration of the vehicle in the country.

II — Facts and procedure

17Mr and Mrs Weigel, who are German nationals originally resident in Germany, moved to the Vorarlberg region of Austria in 1996. Their move followed Mr Weigel's appointment as director of the Vorarlberger Landesbibliothek (Vorarlberg State Library).

18On moving, the plaintiffs brought their respective cars with them and applied to have them registered in Austria. This resulted in a decision of the Finanzamt (Tax Office) Feldkirch of 2 October 1996, assessing Mr and Mrs Weigel to the NoVA in respect of both motor vehicles, on the basis that it was in each case a first-time registration in Austria (Paragraph 1(3) of the NoVAG).

19The tax charged to Mr Weigel was in respect of a 1995 Mitsubishi Space Wagon GLXi. The taxable value was set at ATS 187 000 in accordance with the Eurotax fixed valuations. Applying a tax rate of 14%, a charge to the No VA of ATS 26 180 was assessed. Under Paragraph 6(6) of the No VAG, a surcharge of 20% of the base tax, amounting to ATS 5236, was also assessed. The total charge to tax, comprising both base tax and surcharge, thus came to ATS 31 416.

20The tax charged to Mrs Weigel was in respect of a 1993 Nissan Sunny Y10 L2. The taxable value was set at ATS 71 000, again in accordance with the Eurotax valuations. Applying a tax rate of 9%, a charge to the No VA of ATS 6 390 was assessed, plus a surcharge of ATS 1 278, yielding a total of ATS 7 668.

21The Weigels brought proceedings before the Verfassungsgerichtshof (Constitutional Court) which declined to hear the case and, upon the plaintiffs' application, remitted the case to the administrative court of competent jurisdiction, the Verwaltungsgerichtshof, before which the plaintiffs claimed that the aforementioned tax rules were incompatible with Community law.

22Taking the view that the outcome of the dispute called for an interpretation of Community law, the Austrian court referred the following questions to the Court for a preliminary ruling:

'1. Is Article 39 EC (free movement of workers) or Article 12 EC (discrimination on the ground of nationality) to be interpreted as meaning that it is contrary to those provisions for a tax calculated on the basis of standard fuel consumption (Normverbrauchsab-gabe, basic tax and surcharge) to be charged on a vehicle brought into the Republic of Austria from another Member State of the Community by a person moving residence in connection with a change of employment?

2. Do Article 90 EC (...) or Article 23 EC (...) and Article 25 EC (...) preclude the imposition of the standard fuel consumption tax (...) referred to in the first question (...)?

3. Is the surcharge payable on the Norm-verbrauchsabgabe referred to in the first question compatible with the Sixth Council Directive (77/388/EEC) of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes (...), as amended by Council Directive 91/680/EEC (...)?'

23In the proceedings before the Court, written observations were submitted by Mr and Mrs Weigel, by the Austrian, Finnish and Danish Governments, and by the Commission.

III — Legal Analysis

The first question

24By its first question, the referring court essentially asks whether the Treaty provisions on the free movement of workers, or the general prohibition of discrimination laid down in Article 12 EC, preclude the assessment of NoVA on persons moving residence within the common market for reasons of employment and bringing their own cars with them in so doing. But arguments raised in these proceedings bid the Court, as we shall see, not to restrict the analysis of the Austrian measure to the Treaty provisions expressly cited by the referring court but also to take into consideration various provisions of secondary law, contained in Directive 83/183, which pursue essentially the same objective.

25Let me preface my analysis by saying that, strictly speaking, the answer to this question may require separate consideration of the NoVA base tax and the NoVA surcharge (above, paragraphs 15 and 16). However, I will deal with the latter, in relation to the specifically fiscal aspects, in my analysis of the second question, and I can therefore restrict the discussion here to the NoVA base tax. I will now examine, in turn, its compatibility with Article 39 EC and with Directive 83/183.

The NoVA and free movement of workers

26In the Weigels' view, the legislation in question is incompatible with Article 39 EC because it gives rise to manifest discrimination against workers coming from other Member States. They alone are obliged to pay the NoVA on moving residence, whereas workers who change residence within the country in question are not required to pay the tax.

27The intervening governments, for their part, are at one in urging a negative answer to the first question, relying on arguments that are also in large part identical.

28They contend, first of all, that according to the case-law of the Court, non discriminatory national rules which affect access to the labour market only indirectly are not an obstacle to the free movement of workers. The tax in question does not have any direct effect on the ability of workers coming from other Member States to take up employment in Austria.

29The NoVA should therefore be regarded as one of the many provisions of national law that emigrant workers taking up employment in another Member State have to reckon with and by which they are sometimes adversely affected due to the failure to harmonise national legislation at Community level.

30In any event, the Austrian Government in particular points out, the imposition of the NoVA does not constitute a discriminatory measure as its application to situations such as the present is in reality intended to ensure the equal tax treatment of Austrian workers, who pay the NoVA at the time of purchasing their cars, and immigrant workers.

31Since therefore the measure is in substance one applicable without distinction, the alleged obstacle to the free movement of persons, even if it existed, would be justified by overriding reasons of public interest, such as environmental protection, road safety and combating the erosion of the tax base. The measure in question could not therefore be regarded as contrary to Article 39 EC.

32The Commission, for its part, concerns itself only secondarily with the conformity of the NoVA with Article 39 EC, because in its view the tax must be considered in the first instance in the light of Directive 83/183.

33In the Commission's opinion, given that the NoVA is incompatible with that directive in respect of the part of it that exceeds the administrative cost of the vehicle registration formalities, there would be no point in also examining whether or not it is compatible with Article 39 EC, except — obviously — in respect of the part that does not exceed the cost of the service rendered and which is therefore not incompatible with the directive.

34In the Commission's view, the No VA is not, in any event, contrary to Article 39 EC in respect of this limited part. The Commission shares the view that any mischiefs arising as a result of the tax are not the result of discrimination between Austrian workers and those coming from other Member States but are the inevitable consequence of the absence of measures harmonising vehicle registration rules and, hence, of the disparities between national laws. 7

35Neither, the Commission lastly observes, can the Austrian tax — referring again to that part of it that does not infringe the directive — be regarded as contrary to Article 12 EC, given its non-discriminatory nature.

36Turning to consider the arguments of the interveners, I would first observe that, according to settled case-law, 'by prohibiting every Member State from applying its law differently on the ground of nationality, within the field of application of the Treaty, Articles 7 and 48 [of the Treaty, now, after amendment, Articles 12 EC and 39 EC] are not concerned with any disparities in treatment which may result, between Member States, from divergences existing between the laws of the various Member States, so long as the latter affect all persons subject to them in accordance with objective criteria and without regard to their nationality'.

37Like the Member States who intervened in these proceedings, I too take the view that this is precisely the situation here, as a result of the imposition in Austria, but not in other Member States and specifically not in Germany, of a tax on the fuel consumption of motor vehicles. That disparity unquestionably gives rise, albeit indirectly, to a handicap for persons moving, but that is — precisely — the inevitable consequence of the application to the migrant worker of the laws of the host country.

38The key point for present purposes, however, is that those laws are applied on the basis of a criterion, that of first-time registration in the country, which can certainly be considered — to use the Court's words — objective and non-dis criminatory.

39It therefore follows directly from the case-law cited that taxation such as the No VA base tax is not contrary to Article 39 EC.

The No VA and Directive 83/183

40I now turn to examine whether, as the plaintiffs in the main proceedings and the Commission maintain, the tax in issue is contrary to Directive 83/183 and specifically to Article 1(1) thereof, which requires Member States to exempt from turnover tax, excise duty and other consumption taxes personal property imported permanently from another Member State by private individuals.

41That question is not in fact specifically raised by the national court, but it was at the centre of considerable discussion at the hearing and cannot therefore be disregarded, because, as will be recalled, '[i]t is the Court's duty to interpret all provisions of Community law which national courts need in order to decide the actions pending before them, even if those provisions are not expressly indicated in the questions referred'.

42In the Weigels' view, then, Article 1(1) of Directive 83/183 applies to the No VA as well, since the No VA is in reality a turnover tax.

43The Commission reaches the same conclusion, at least in respect of the part by which the No VA base tax exceeds the administrative cost of registering the vehicle. The provision in the directive prohibits not only taxes that directly hinder the importing of the property but also those that are imposed on transactions intimately bound up with the importation, as is precisely the case with the registration of a motor vehicle.

44Nor is this contradicted, according to the Commission, by Article 1(2) of the directive, which excludes 'motor vehicle registration fees' from the exemption. The exemption from tax provided for by subparagraph (1) of the same article constitutes an application of the principle of free movement of persons, hence the exception in Article 1(2) must be strictly construed. The term 'registration fee', in particular, is subject to strict interpretation and should comprise only fees intended to cover the costs of registration.

45This point is supported, moreover, by the French and English versions of the directive. The former uses the term 'droits' and not 'taxes'. The latter uses the term 'fees', which describes the charges paid in consideration of a service.

46Let me say straight away that this literal interpretation does not convince me and I find more persuasive the opposite conclusion reached by the Member States that submitted observations in this case.

47It seems to me, as it does to the Austrian, Danish and Finnish Governments, that taxes such as the No VA base tax, which are charged upon the registration of a motor vehicle, do not constitute 'turnover tax, excise duty and other consumption taxes which normally apply to' 'personal property imported permanently from another Member State by private individuals' and that they must therefore be regarded as excluded from the scope of the exemption provided for in Article 1(1) of Directive 83/183.

48First of all, I agree with the Austrian Government that the No VA does not seem at all to fall within 'taxes which normally apply to' personal property 'imported permanently' within the meaning of the provision, because the Austrian tax is in fact levied as a consequence of registration. To appreciate the different character of the No VA compared to the taxes contemplated by the directive one need only consider the case of the import of a collectors' vehicle or in general any vehicle not intended for use on the public road network. In such cases, no charge to tax would arise.

49Furthermore, I agree with the Finnish Government when it points out that Article 1(2) of Directive 83/183 excludes from the tax exemption for personal property imported permanently all 'duties and taxes connected with the use of such property within the country'. It seems to me too that a tax such as the NoVA specifically concerns the use of a vehicle within the country and not its mere importation (suffice it to consider the exemption, mentioned above, for collectors' vehicles and vehicles in general not intended for road use).

50In my view, therefore, taxes of this kind should rather be treated as '[s]pecific and/or periodical duties and taxes connected with the use of such property within the country, such as for instance motor vehicle registration fees, road taxes and television licences', which are expressly excluded from the exemption by Article 1(2) of the directive.

51I would also observe, as do the Austrian and Finnish Governments, that an interpretation whereby Member States are not obliged to grant exemption from the NoVA in accordance with Article 1(1) of the directive on tax exemptions is entirely consistent with the proposal for a directive governing the tax treatment of private motor vehicles moved permanently to another Member State in connection with a transfer of residence.

52Under that proposal, the adoption of a directive to prohibit Member States from imposing 'registration taxes and/or other consumption taxes (...) on private motor vehicles registered in other Member States and brought into that Member State permanently in connection with the transfer of normal residence of a private individual' (Article 1) is necessary precisely because of the inadequacy of the rules laid down by Directive 83/183 (fourth, fifth and seventh recitals).

53Furthermore, it seems to me that the Kingdom of Denmark is correct in observing that to maintain, as the Commission does, that the exclusion of 'motor vehicle registration fees' in Article 1 (2) of Directive 83/183 applies only to charges intended to cover administrative costs, amounts to ascribing to that provision a purely pleo nastic effect. It is well known that the recovery of expenses incurred in discharging an administrative formality that is not in itself contrary to Community law, such as, in this case, the registration of a vehicle for use within the state, is a measure that is compatible with the Treaty.

54Lastly, the Commission's argument seems to me to be difficult to reconcile with what the Court itself had to say in the recent Cura Anlagen judgment — on the very subject, it should be noted, of the Austrian NoVA. There the Court confirmed that since the taxation of motor vehicles has not yet been harmonised at Community level, Member States are free to exercise their powers of taxation in that area, provided they do so in compliance with Community law. 1

55In conclusion, I take the view that the imposition of a tax such as the NoVA base tax on a migrant worker moving to Austria from another Member State to take up employment there and importing his or her own vehicle into that country is not incompatible with the rules on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals laid down by Directive 83/183 and, specifically, Article 1 thereof.

56I therefore propose that the answer to be given to the first question is that a national measure imposing a tax such as the NoVA base tax — which is payable upon the first-time registration in the state of a motor vehicle and is calculated on the basis of the value of the vehicle and its fuel consumption — on a migrant worker moving to Austria from another Member State to take up employment there and importing his or her own vehicle into that country and registering it, is not contrary to Article 39 EC. Nor is the imposition of such a tax contrary to the rules on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals laid down by Directive 83/183 and, specifically, Article 1 thereof.

The second question

57By its second question, the national court is actually asking the Court two distinct questions which need to be dealt with separately. In the first place, it asks whether the disputed tax constitutes a customs duty or a charge having equivalent effect for the purposes of Articles 23 EC and 25 EC. In the second place, it asks essentially whether the relevant Austrian legislation gives rise to discriminatory internal taxation and is therefore contrary to Article 90 EC, and if so to what extent.

(a) The NoVA and Articles 23 EC and 25 EC

Arguments of the parties

58The Weigels argue, not without some ambiguity, that the question should be answered in the affirmative, since they believe that the Austrian measure falls foul of the prohibition of charges equivalent to customs duties.

59In their view, since it is levied on a motor vehicle upon its first-time registration in the state, the NoVA bears directly on the import of a good. It is therefore equivalent to a customs duty and as such contrary to Articles 23 EC and 25 EC.

60In any event, the NoVA should not apply in the present case, given that under Article 2 of Regulation No 918/83 on reliefs from customs duty granted when goods are put into free circulation in the Community, 12 'personal property imported by natural persons transferring their normal place of residence ... to the customs territory of the Community shall be admitted free of import duties'. Mr and Mrs Weigel argue that this system of reliefs should also apply in the case of a transfer of residence within the Community, since otherwise the result would be that intra-Community transfers of residence were treated less favourably, without justification, than those involving a crossing of the Community's customs frontier.

61The Austrian and Finnish Governments, as well as the Commission, take the contrary view that the No VA and the surcharge are not customs duties or charges having equivalent effect but form part of a general system of internal taxation. Both apply to all vehicles, whether purchased within the state or abroad, and they apply to them on the basis of objective and non discriminatory criteria (in this case, registration in Austria). Both tax measures, therefore, fall outside the scope of the prohibition laid down in Articles 23 EC and 25 EC and should instead be considered in the light of Article 90 EC.

62For my part, I must first say that Regulation No 918/83, which is relied upon by the plaintiffs in the main proceedings, does not appear to me to be a suitable yardstick for present purposes. That regulation applies in the context of imports of property from a non-Community country and is therefore entirely unsuitable for application in the different context of a transfer of property within the Community.

63The point which does need to be considered, as I have said, is whether or not a tax such as the No VA (base tax and surcharge) falls to be regarded as a customs duty or an equivalent charge for the purposes of Articles 23 EC and 25 EC and is therefore contrary, as such, to one of the fundamental principles of Community integration, that of the free movement of goods within the common market.

64In this regard, I would recall that according to settled case-law, the prohibition of customs duties and equivalent charges extends to 'any pecuniary charge, whatever its designation and mode of application, which is imposed unilaterally on goods by reason of the fact that they cross a frontier'.

65In order to answer the first part of this question it is therefore necessary to establish whether or not the NoVA is a pecuniary charge which is imposed on goods by reason of the fact that they cross a frontier.

66From the account of the Austrian tax provisions given in these proceedings it is quite clear that the NoVA, like similar charges that exist in other Member States, is not levied upon the crossing of the frontier, but upon the sale, for on-road use, of a vehicle not yet registered in the state, upon the commercial hiring out of such a vehicle, or upon its first-time registration. It cannot therefore be regarded either as a customs duty or as a charge having equivalent effect prohibited under Articles 23 EC and 25 EC, but rather as a measure falling within a general system of internal taxation.

67I therefore feel able to conclude on this point that taxes such as the NoVA base tax and the NoVA surcharge do not constitute customs duties or charges having equivalent effect within the meaning of Articles 23 EC and 25 EC.

(b) The Austrian system and Article 90 EC

68With regard to this question, Mr and Mrs Weigel recall firstly that, according to Community case-law, '[a] national tax system which is liable to eliminate a competitive advantage held by imported products over domestic products would be manifestly incompatible with Article 95, which seeks to guarantee that internal charges have no effect on competition between domestic and imported products'.

69Now, according to the plaintiffs in the main proceedings, the disputed tax has just such an effect, because, by virtue of the fact that it is charged only on second-hand cars imported from other Member States, thereby increasing their price, the NoVA eliminates the competitive advantage on the Austrian market that those cars would otherwise hold. As a consequence, a tax such as the NoVA is manifestly incompatible with Article 90 EC.

70According to the Austrian and Finnish Governments, on the other hand, the NoVA and the surcharge form part of a general system of internal taxation which is designed to ensure that every car registered in Austria is subject to the same taxation. Such a tax system is therefore not discriminatory either as regards the base tax or as regards the surcharge.

71The former is charged on every vehicle registered for the first time in Austria, regardless of its origin and place of purchase, and so clearly cannot be regarded as discriminatory.

72As for the surcharge, while it is true that this does not apply to all vehicles, since it is due only if liability for the base tax accrues otherwise than upon a supply, it nevertheless performs an equalising function in that it compensates for the fact that the No VA basis of assessment is lower in those circumstances, being exclusive of VAT.

73The Commission, for its part, having noted that in general a tax is incompatible with Article 90 EC if it bears more heavily on imported products than on similar domestic products, goes on to analyse the base tax and the surcharge separately in the light of that test. While the base tax, in its view, is in principle compatible with Article 90 EC, the surcharge, on the other hand, is prohibited by that provision, because of its intrinsically discriminatory character.

74For my part, I fully agree with that view, for the reasons I now turn to illustrate.

The No VA base tax

75In order to ascertain whether or not the base tax is discriminatory for present purposes, it is necessary to compare the tax charged on imported used cars, such as those with which the main proceedings are concerned, with that charged on identical used cars already on the Austrian market.

76In this regard, I too would observe — as the Commission does — that the No VA is a single-stage tax, payable at the latest upon first-time registration. Consequently, while it is true that the purchaser of a used vehicle already registered in Austria does not pay the No VA directly, the price he or she pays for the vehicle is still one that already includes a residual portion of the NoVA, which reduces in line with the depreciation for the use of the vehicle.

77There is therefore no discrimination between domestic used vehicles and imported used vehicles if the NoVA charged on the latter does not exceed the amount of the residual NoVA incorporated in the price of a similar used vehicle available on the Austrian market.

78In order for that condition to be met, it is therefore necessary that the imputed value of the imported used vehicle taken by the tax administration as the basis of assessment should faithfully reflect the value of a similar used vehicle on the Austrian market.

79However, the plaintiffs in the main proceedings complain that the fixed scale applied by the Austrian tax administration to determine the value of their vehicles — in this instance by reference to the Eurotax value — did not satisfy the above test, since it produced an inflated reference value and, hence, an excessive and discriminatory charge to tax.

80On this point, however, I would agree with the Commission, when it observes that the use of fixed scales to determine the value of an imported used vehicle does not in itself give rise to discrimination, provided that the fixed scales precisely reflect — as the Community case-law has clarified — the actual depreciation of the vehicle. Only if that is so will the tax charged on imported vehicles not 'in any case exceed the amount of the residual tax incorporated in the value of similar second-hand vehicles already registered in the national territory' 16 and can the tax in question be regarded as compatible with Article 90 EC.

81It is for the national court, however, to determine whether the method used by the Austrian authorities, based on the Eurotax valuations, complies in its practical application with the above requirements.

82I therefore conclude that a tax such as the NoVA base tax, the amount of which is calculated using fixed scales to determine the value of an imported used vehicle, does not in itself give rise to discrimination prohibited by Article 90 EC provided the fixed scales precisely reflect the actual depreciation of the vehicle and the taxable value imputed to the vehicle thus corresponds exactly to the value of a similar used vehicle to be found on the domestic market. It is for the national court, however, to determine whether the fixed scale method used by the Austrian administration satisfies these conditions.

The No VA surcharge

83Turning to the surcharge provided for under Paragraph 6(6) of the NoVAG, I would first observe, as the Commission does, that it applies predominantly to private imports of new or used cars into Austria and only by way of exception to purely domestic transactions, such as, for example, the case of a car privately assembled by an enthusiast.

84According to settled case-law, the fact that a charge is imposed on an extremely small volume of domestic production as well as on imported products does not preclude the application of Article 90 EC.

85What is more, as the Court has had occasion to explain, the laying down of tax arrangements which differentiate between certain products 'is compatible with Community law ... only if [such differentiation] pursues objectives of economic policy which are themselves compatible with the requirements of the Treaty and its secondary legislation, and if the detailed rules are such as to avoid any form of discrimination, direct or indirect, in regard to imports from other Member States or any form of protection of competing domestic products', the Court also having held that 'differential taxation is incompatible with [Article 90 EC] if the products most heavily taxed are, by their very nature, imported products'.

86There seems to me no doubt that the imposition of the surcharge provided for in Paragraph 6(6) of the NoVAG constitutes an instance of tax arrangements which differentiate between used cars, in such a way that the products most heavily taxed are indeed the imported ones. It emerged clearly at the hearing, besides, that the circumstances in which the surcharge affects non-imported products are entirely residual.

87I therefore conclude that a tax such as the No VA surcharge, which applies to imported products in ordinary circumstances and to domestic products only in exceptional circumstances, is a discriminatory charge and, as such, incompatible with Article 90 EC. I note, moreover, that the Commission stated at the hearing that it has already commenced infringement proceedings in that regard.

88I therefore propose that the second question referred by the national court be answered as follows:

Since they do not constitute customs duties or charges having equivalent effect, taxes such as the NoVA are not contrary to Articles 23 EC and 25 EC.

Nor does a tax such as the NoVA base tax, the amount of which is calculated using fixed scales to determine the value of an imported used vehicle, in itself give rise to discrimination prohibited by Article 90 EC provided the fixed scales precisely reflect the actual depreciation of the vehicle and the taxable value imputed to the vehicle thus corresponds exactly to the value of a similar used vehicle to be found on the domestic market. It is for the national court, however, to determine whether the fixed scale method used by the Austrian administration satisfies these conditions. The NoVA surcharge, on the other hand, is discriminatory and hence incompatible with Article 90 EC in so far as it applies to imported products in ordinary circumstances and to domestic products only in exceptional circumstances.

The third question

89By its third question, the referring court essentially asks whether the surcharge provided for by Paragraph 6(6) of the No VAG is compatible with the harmonised rules on value added tax brought in by the Sixth VAT Directive.

90Only Mr and Mrs Weigel propose that this question be answered in the negative. They argue that the surcharge in question is in the final analysis a disguised turnover tax and, as such, is incompatible with the Sixth VAT Directive, in particular Article 33 thereof, which prohibits the maintenance of national taxes other than VAT which have the characteristics of a turnover tax.

91The Commission and the governments that submitted observations to the Court are of the contrary view that the surcharge is not a turnover tax and they therefore propose that the question be answered in the affirmative.

92For my part, I could refrain from expressing any view on the question, given that I have proposed that the surcharge be considered a prohibited form of taxation under Article 90 EC.

93In any event, I am unable to subscribe to the interpretation proposed by Mr and Mrs Weigel because it seems to me too that the surcharge does not meet the characteristics of a turnover tax.

94The Court has consistently held that the purpose of Article 33 of the Sixth Directive 'is to prevent the introduction of taxes, duties and charges which, through being levied on the movement of goods and services in a way comparable to VAT, would jeopardise the functioning of the common system of VAT. Taxes, duties and charges must in any event be regarded as being imposed on the movement of goods and services in a way comparable to VAT if they exhibit the essential characteristics of VAT'.

95In defining those characteristics, the Court has repeatedly made clear that 'VAT applies generally to transactions relating to goods or services, it is proportional to the price of those goods or services, it is charged at each stage of the production and distribution process and finally it is imposed on the added value of goods and services, since the tax payable on a transaction is calculated after deduction of the tax paid on the previous transaction'.

96Now it does not appear to me that those characteristics are present in the surcharge in question.

97In the first instance, it does not apply generally to transactions relating to goods or services nor does it apply at all stages of production and distribution, since it has to be paid only in respect of certain transactions concerning a particular class of products, motor vehicles, and within that class only those vehicles which have not previously been registered in the country.

98Furthermore, the surcharge does not give rise to any possibility of deduction (which is entirely consistent, besides, because it is, as we have seen, a single-stage charge) and its basis of assessment is not the value of the goods but the amount of a tax paid on the goods, whence it cannot be regarded as being imposed on the added value.

referred to in the Sixth VAT Directive and

99All these considerations lead me to cannot therefore be considered to be a conclude that the NoVA surcharge does not parallel tax prohibited by Article 33. satisfy the requirements of a turnover tax as

IV — Conclusion

100In the light of the foregoing considerations, I propose that the Court answer the questions referred by the Verwaltungsgerichtshof as follows:

(1) A national measure imposing a tax such as the NoVA base tax — which is payable upon the first-time registration in the state of a motor vehicle and is calculated on the basis of the value of the vehicle and its fuel consumption — on a migrant worker moving to Austria from another Member State to take up employment there and importing his or her own vehicle into that country and registering it, is not contrary to Article 39 EC.

Nor is such a measure contrary to the rules on tax exemptions applicable to permanent imports from a Member State of the personal property of individuals laid down by Directive 83/183 and, specifically, Article 1 thereof. (2) Since they do not constitute customs duties or charges having equivalent effect, taxes such as the No VA are not contrary to Articles 23 EC and 25 EC.

Nor does a tax such as the No VA base tax, the amount of which is calculated using fixed scales to determine the value of an imported used vehicle, in itself give rise to discrimination prohibited by Article 90 EC provided the fixed scales precisely reflect the actual depreciation of the vehicle and the taxable value imputed to the vehicle thus corresponds exactly to the value of a similar used vehicle to be found on the domestic market. It is for the national court, however, to determine whether the fixed scale method used by the Austrian administration satisfies these conditions. The No VA surcharge, on the other hand, is discriminatory and hence incompatible with Article 90 EC in so far as it applies to imported products in ordinary circumstances and to domestic products only in exceptional circumstances.

(3) A tax such as the No VA surcharge does not satisfy the requirements of a turnover tax as referred to in the Sixth VAT Directive and cannot therefore be considered to be a parallel tax prohibited by Article 33.

Notes

(1) Original language: Italian.

(2) Sixth Council Directive 7-/388/EEC of 17 May 1977 on the harmonisation ot the laws of the Member States relating to turnover taxes — Common system of value added tax: uniform basis of assessment (OJ 1977 L 145. p. 1). as amended by Council Directive 91/680/EEC of 16 December

(199) 1 supplementing the common system of value added tax and amending Directive 77/388/EEC with a view to the abolition of fiscal frontiers (OJ 1991 L 376. p. 1).

(3) OJ 1983 1 105, p. 64.

(4) BGBl. No 695/1991.

(5) Ministry of Finance Circular of 1 September 1995.

(6) Case C-190/98 Graf [2000] ECR I-493, paragraph 23.

(7) In support, the Commission cites Case C-177/94 Perfili [19961 ECR I-161, paragraph 27, Case C-379/92 Peralta [1994| ECR I-3453, paragraph 52. and the Opinion of Advocate General Jacobs in Case C-451/99 Cura Anlagen [2002] ECR I-3193, points 37 to 47.

(8) Sec, in relation to Article 48 of the Treatv (now, after amendment. Article 39 EC), Case 1/78 Kenny [1978] ECR

(148) 9, paragrapli 18. Sec also Joined Cases C-393/99 and C-394/99 Hen-em and Others [2002] LCR I-2829, paragraphs 50 and 51. In relation to other aspects of the free movement of persons, see the cases cited by the Commission, footnote 7 above.

(9) Case C-280/91 Viessmann [1993] ECR I-971, paragraph 17, and Case C-42/96 Immobiliare SIF [1997] ECR I-7089, paragraph 28.

(10) Proposal for a Council Directive governing the tax treatment of private motor vehicles moved permanently to another Member State in connection with a transfer of residence or used temporarily in a Member State other than that in which they are registered, COM (1998) 30 final (OJ 1998 C 108 , p. 75), as amended by COM (1999)

(165) final (OJ 1999 C 145, p. 6).

(11) Case C-451/99 Cura Anlagen [2002] ECR I-3193, paragraph 40.

(12) Council Regulation (EEC) No 918/83 of 28 March 1983 setting up a Community system of reliefs from customs duty ('Regulation No 918/83'; OJ 1983 L 105, p. 1).

(13) Of the many judgments to this effect, see Case C-234/99 Nygård [2002] ECR I-3657, paragraph 19.

(14) See, tor example, in relation to the Danish vehicle registration charge, the Opinion of Advocate General Jacobs in Case C-383/01 Danske Bihimportorer [2003] ECR I-6065. point 36

(15) See Case C-47/88 Commission v Denmark [1990] ECR I-4509, paragraph 9, and Case C-345/93 Nunes Tadeu [ 1 9 9 5] ECR I-479, paragraph 18.

(16) Case C-393/98 Gomes Valente [2001] ECR I-1327, Paragraph 28.

(17) Case 193/85 Co-Frutta [1987] ECR 2085, paragraphs 11 to 13, and Case C-343/90 Lourenço Dias [1992] ECR I-4673, paragraph 53.

(18) Case C-90/94 Haahr Petroleum [1997] ECR I-4085, paragraph 29.

(19) Case 106/84 Commission v Denmark [1986] ECR 833, paragraph 21 and Case C-90/94 Haahr Petroleum (above), paragraph 30.

(20) Case C-347/90 Bozzi [1992] ECR I-2947, paragraph 9.

(21) See, in particular, the judgments in Case 252/86 Bergandi v Directeur-Généraldeslmpôts [1988] ECR 1343, paragraph

(15) , Joined Cases 93/88 and 94/88 Wisselink and Others v Staatssecretaris van Financiën [1989] ECR 2671, paragraph 18, Case C-109/90 Giant v Gemeente Overuse [1991] ECR 1-1385, paragraphs 11 and 12, Case C-200/90 Dansk Denkavit and Poulsen Trading v Skatteministeriet [1992] ECR I-2217, paragraph 11, and Case C-347/90 Bozzi (above), paragraph 12 and Case C-208/91 Beaulande [1992] ECR I-6709, paragraph 14.