Overview

One of the fundamental EU principles is the free movement of people, business and capital. So Article 63 of the Treaty on the Functioning of the European Union (Article 63) provides that:

‘Within the framework of the provisions set out in this Chapter, all restrictions on the movement of capital between Member States and between Member States and third countries shall be prohibited.’

The concern is that the differences in the domestic inheritance tax rules do potentially provide obstacles in cross-border situations in two respects, namely

(1) that the provisions are capable of being discriminatory and (2) that the provisions are capable of producing double taxation.