Special lump sum contribution of Article 18 of Law 3758/2009
Through its judgment 1685/2013 the Plenary Session of the Supreme Administrative Court (Conseil d’ Etat) ruled, that Article 18 of Law 3758/2009, by virtue of which a special lump sum contribution was imposed on income earned in 2007, is not contrary to the Greek Constitution.
The date of hearing of this case was scheduled in the first instance on a “preferential” basis, i.e. soon, in the context of the institution of the “model process”, in view of the fact that many similar recourses for the same issue had already been filed, so that the date of hearing of other similar cases, where the same legal issue arose, would be determined following the irrevocable resolution of the arising legal matter.
The judgment of the court of first instance (judgment 18440/2009 of the Athens Sole Member Administrative Court of First Instance ), which accepted the relevant recourse, was repealed by judgment 1123/2010 of the Athens Administrative Court of Appeal, which was however repealed by judgment 693/2011 of the 2nd Chamber of the Supreme Administrative Court (Conseil d’ Etat). Nevertheless, due to this latter judgment of the Supreme Administrative Court (Conseil d’ Etat), ruling that Article 18 of Law 3758/2009 contradicts the Constitution, but also due to the significance of the matter, as well as of the case as a whole, the cassation had to be referred, in accordance with the law (Article 100(5) of the Constitution), to the Plenary Session of the Supreme Administrative Court for final judgment. The Plenary Session delivered the aforementioned judgment 1685/2013, ruling that Article 18 of Law 3758/2009 is not contrary to the Constitution.
In view of the judgment of the Plenary Session of the Supreme Administrative Court, the Greek Administrative Courts of First Instance reject, through summary judgments the recourses of all taxpayers as “evidently not legally substantiated” in accordance with the provisions of the Code of Administrative Procedure, as in force.
In our opinion, the Supreme Administrative Court confirms with the judgment of the Plenary Session the fact that, in view of the current fiscal crisis it has been applying a sui generis “law of emergency” in tax issues for the past years, making the fiscal interest of the State to utmost public interest to the detriment of the citizens’ rights. The aforementioned judgment of the Plenary Session of the Supreme Administrative Court seems to be the most typical example of a series of relevant judgments.
We are of the view that the judgment of the majority of the Plenary Session cannot be based on the Constitution. In particular, we consider that it is directly contrary to Article 78(2) of the Constitution which prohibits absolutely any retrospective taxation extending in a year prior to the “fiscal year” preceding the one within which the tax is imposed. Any failure of the legislation to refer to taxable income earned in the year preceding the one within which the imposition of a tax is contemplated, does not justify the taxation of income earned within the fiscal year directly prior thereof, as in the case of the special lump sum contribution of law 3758/2009 that we challenged on your behalf.
In view of the above developments, we would like to inform our clients that the due amount of the contribution must be paid.