European Commission refers Hungary to ECJ for tax rule violation Maureen Cosgrove at 10:44 AM ET
[JURIST] The European Commission [official website] on Thursday referred Hungary [press release] to the European Court of Justice (ECJ) [official website] for violations of EU rules related to the taxation of telecommunications operators. Article 12 of the EU's Authorisation Directive [text, PDF] contains specific rules for member nations regarding the administrative charges a state can impose on telecommunication network and service providers. Hungary introduced its "crisis taxes" in 2010 in an effort to improve the country's budget revenues. The Commission maintains that these taxes are illegal because member nations are not permitted to implement such taxes for the purpose of raising revenues to reduce the national deficit. Furthermore, the Commission indicated that "increasing the financial burden of telecoms operators could have an impact on consumers' bills, distort competition and impede investment" in the telecommunications sector. The Commission also alleges that Hungary's failure to consult with interested parties prior to implementing the taxes constitutes a violation of EU law.
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