Premium
Can Tax Authorities Scrutinise the Ideas of Foreign Charities? The ECJ's Persche Judgment and Lessons from US Tax Law
Author(s) -
Georgopoulos Theodore
Publication year - 2010
Publication title -
european law journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.351
H-Index - 54
eISSN - 1468-0386
pISSN - 1351-5993
DOI - 10.1111/j.1468-0386.2010.00518.x
Subject(s) - position (finance) , law , european court of justice , tax law , direct tax , transparency (behavior) , power (physics) , law and economics , primary authority , action (physics) , tax avoidance , common law , economics , european union , business , double taxation , political science , european union law , finance , international trade , physics , quantum mechanics , legal research
The European Court of Justice's (ECJ's) recent Persche judgment poses important questions about the relationship between taxation of gifts and charitable purposes in the light of EC law requirements. This article argues that by applying its established case‐law to the matter of donors to foreign recipient bodies, the ECJ takes a position on the social role of both charities and tax deduction. Moreover, the position of the ECJ clearly paves the way for tax authorities to check the objectives and the values pursued by recipient bodies seeking tax‐preferred status, a situation that recalls a similar power recognised under specific circumstances of the US Internal Revenue Services. Arguably, the ECJ case‐law has more profound consequences on charitable action, since it seems that the power accorded to tax authorities of the Member States to check the purposes of charitable organisations leads to a cosmopolitan apprehension of charitable action while it pushes charities to enhance transparency in their activities.