The Commission has decided to refer France to the Court of Justice of the European Union (CJEU) over its tax treatment of donations made to bodies pursuing general-interest objectives with a registered office in another EU or EEA Member State.

France exempts donations and bequests to public or public-interest bodies, including charities, from registration duties (taxes on transfers without consideration where such bodies are established in France). However, bodies with similar characteristics established or carrying out similar activities in other Member States of the European Union are subject to a 60% tax on the value of the donation or bequest received.

According to the Commission, the taxation of donations to foreign bodies constitutes an unjustified obstacle to the free movement of capital as laid down in Article 63 of the Treaty on the Functioning of the European Union and Article 40 of the Agreement on the European Economic Area. Therefore the difference in treatment may deter French taxpayers from making donations or bequests to charities established outside France.

For further details, see the Commission’s website.