Navigation path

Left navigation

Additional tools

Other available languages: FR DE ES


Brussels, 6 July 2007

Direct Taxation: The Commission takes Spain to the Court of Justice over its discriminatory taxation of lottery winnings

The European Commission has decided to refer Spain to the European Court of Justice for the way in which lottery winnings are taxed. According to the Spanish legislation, lottery winnings from lotteries organised abroad are subject to progressive income tax, whereas an exemption from income tax is applied on the income resulting from lotteries organised in Spain by certain institutions. The Commission considers these rules contrary to the EC Treaty and the EEA Agreement, as they restrict the freedom to provide services.

According to the Spanish rules, income earned in Spain in the form of rewards or winnings from competitions, games or gambling is subject to taxation. However, an exemption applies on lottery winnings from lotteries and gaming organised by the state lottery, the gaming agency (ONLAE) and agencies of the autonomous communities as well as on the income from draws organised by the Spanish Red Cross and the Spanish National Association of the Blind.

Spain argues that the exemption is not discriminatory as it is based on the nature of the organisers and not on the place of their establishment. However, the Commission considers that the exemption provided in the Spanish legislation constitutes a discrimination prohibited by the EC Treaty, as the favourable treatment is not open to other EU entities of the same nature than those mentioned for the exemption purposes.

The Commission agrees that the Member States have discretion in deciding on how to avoid the damaging consequences that can derive from gambling but only to the extent that it does not involve any discrimination based on nationality.

The Commission had sent a Reasoned Opinion to Spain on 15 December 2006 to request it to change its legislation. Spain's reply was negative.

The Commission's cases reference number is 2005/2431.
For the press releases issued on infringement procedures in the taxation or customs area see:
For the latest general information on infringement measures against Member States see:

Side Bar