CJEU – Recent Developments in Direct Taxation 2023

1. Introduction

The request for a preliminary ruling in the KEVA and others case concerns the interpretation of the free movement of capital in the TFEU. Questions have arisen in a case involving three pension institutions established in Finland: Keva, Åland S. 118Island Pension Fund and the Church Central Fund. When these Finnish pension institutions receive dividends from Swedish companies, Swedish WHT (withholding tax, also known as ‘coupon tax’) is levied. Swedish Public General Pension Funds (AP funds) receiving corresponding dividends are tax exempt.

The Supreme Administrative Court (SAC) wants to clarify whether the WHT levied on foreign public pension institutions is compatible with EU law. The purpose of this contribution is to give the background of the case at hand, and present the arguments raised by the different stakeholders concerning the question whether the Swedish WHT is in compliance with EU law or not.

Sections 2.–3. of this contribution are based on the request from the Swedish SAC to the CJEU. In addition, Section 3 is based on the documentation in the infringement procedure Commission vs Sweden and previous case law. Section 4 provides a more in-depth discussion with rega...