Discriminatory Taxation in the EU

Taxation is one of the core elements of sovereignty and, in light of the Treaties provisions, Member States maintain a wide margin of discretion in this field. Notwithstanding the limited powers conferred to the EU in tax matters, Member States’ tax autonomy is bound by the obligation to respect provisions under EU law that are primarily aimed at regulating other fields. Art. 110 TFEU, prohibiting discriminatory taxation to protect the free movement of goods, is an example of this dynamic. This entry briefly points out such limits, analyses the scope of application of Art. 110 TFEU and highlights the boundaries between the notion of discriminatory taxation, charges having equivalent effect to customs duties and State aids.