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Spain taken to Court

Last Updated: Wednesday 25th May 2011, 14:51 pm

The European Commission is taking Spain to the European Court of Justice in order to try and get the country to change the way that winnings of foreign lotteries are taxed.

Under the current system, winnings of a Spanish lottery are exempt from income tax, but winnings from lotteries outside Spain are subject to taxation in the normal way. The European Commission feels that this discriminates against foreign lottery games, and therefore violates the laws of the European Union which exist to guarantee member states the freedom to trade with each other on equal terms.

In 2006 the European Union asked Madrid to change its position concerning the taxation of foreign lottery games, but that request was refused. The European Commission hopes that, by pursuing the matter through the European Court of Justice, the country will be forced to review its stance. Until it does so, Spain could face substantial fines.

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