CJEU – Recent Developments in Direct Taxation 2023

1. Introduction

In the context of both the 2020 Covid-19 pandemic and 2022 energy crisis and subsequent massive government aid packages, government budgets have been under increasing pressure. The societal call for large profitable companies to pay their fair share when recovering the costs of these crises is widely heard. Indeed, the recent (inter)national policy tendency has been to respond accordingly. This is evidenced by, for example, the introduction within the EU of an effective minimum tax rate of 15% on surplus profits by large domestic or multinational enterprises as of 1 January 2024. Another example is the recently adopted temporary solidarity contribution for the years 2022 and/or 2023 levied on surplus profits realised by enterprises in the extractive industry.

This chapter discusses two related pending cases in which both levies are being disputed by individual companies before the CJEU. Both these cases are technically complex and challenging. In order to be able to properly place them in the right legal context, it is helpful to highlight that they share three features. First of all, they each concern the EU compatibility of excess profit levies charged from large en...