Definición de conceptos culturales

The complex taxation issues of frontier workers in Belgium described in last report have not changed. Some parliamentary debate on the cost to Belgian society for workers taxed in a different state but using public services in Belgium took place during 2012. In a 2012 judgment1 _{the Belgian Supreme Court ruled that EU law does not imply that, where the}

income of a taxpayer is partly taxed in the state of residence and partly taxed in the state where the salary is earned, on the basis of a convention aimed at preventing double taxation such as in the agreement between Belgium and the Netherlands, the tax deductions for child- care and “titres-services” may always be entirely set off against the tax due in the state of residence as if the income tax had been entirely imposed in the state of residence. An amendment of the tax legislation in Finland from 2012 has an impact on frontier workers. It permits tax deductions for work carried out in the person’s home and workers in Finland are entitled to these deductions independent of where the home is located or in which country the company carrying out the deductable home work is registered. Frontier workers in Ireland are required to pay income tax in the country where they earn their income, but their ultimate tax responsibility is with the country where they live and an annual self-assessment of tax liabilities is required. Ireland has double-taxation agreements with all EU Member States, including Croatia. Generally, a person who is resident in Ireland and commutes daily or weekly to a work place in another country where tax is deducted may qualify for ‘Trans- border Workers Relief’. This reduces the tax liability in Ireland, taking account of the tax the person has paid abroad. Where ‘Trans-Border Workers Relief’ applies, the ‘Universal Social Charge’ is not charged on their foreign employment income. During 2011 the Irish Revenue capped the USC at 4% for cross-border workers holding a Northern Ireland Medical Card, however, following an investigation of the relevant EU legislation and discussions with the Health Service Executive, this cap is no longer in place. As of January 2012, cross-border workers living in Northern Ireland, as holders of Northern Ireland Medical cards, will no longer have their rate of Universal Social Charge capped at 4%, instead, if their income is high enough, they will be charged the full rate of 7% in line with Irish residents.2

Non-permanent residents who receive income from employment in Lithuania have to pay income tax in Lithuania irrespective of whether they return daily to the country of resi- dence or not. Income tax for income received in Lithuania could be paid in the country of residence only when there is an agreement between the two countries to avoid double taxa- tion. In Latvia the tax law is unclear on whether frontier workers enjoy the same tax advan- tages as workers residing in Latvia. Frontier workers are considered resident taxpayers and their income subject to deductions for themselves and their dependents. The Law on Income Tax does however not specify if an employee has a right to income tax relief if his/her de- pendants reside in another EU Member State and regulations on tax deductions do not en- compass frontier workers. In the UK, frontier workers from other countries are entitled to a Working Tax Credit under the conditions that they live in another country and perform their actual work in the UK or they live in the UK, but travel abroad to work and return to the UK

1 Case n° F.10.0115.N/1.

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regularly. If frontier workers are away in the country of work for more than eight weeks at a time, their Working Credit will stop.

In Austria there is a residence requirement for social assistance benefits for frontier workers.. There is no special law on frontier workers in Bulgaria and it is unclear from exist- ing case law whether there is a residence requirement for claiming social benefits. So far the Hartmann case has not been referred to in Bulgarian courts. In Croatia there is no specific law on frontier workers. In the Czech Republic access to social assistance and social services depend on residence in the country. EU citizens are however entitled to social benefits pur- suant to Regulations (EEC) No. 1612/68 (492/2011) and (EEC) No. 1408/71 (883/2004). Provisions of the State Social Support Act refer to the directly applicable Regulations, there- fore the question of granting a social benefit to a family member of a frontier worker would probably be resolved in conformity with the Hartmann judgement. There are no special regulations concerning frontier workers in Estonia. To be entitled to social assistance a per- son has to have the right of residence (permanent or fixed term). In Finland issues concern- ing frontier workers arise primarily with Sweden and Estonia. As regards frontier workers from Sweden, they are covered by arrangements concerning the free movement of labour in the Nordic countries that address social security and taxation issues. No such arrangements exist with Estonia. In Germany residence is required for access to social benefits with very limited exceptions. According to the Social Code II, a person who has previously worked in Germany may export their social benefits, including job seeking benefits, to other EU Mem- ber States. In 2012 the Saxonian Administrative Appeals Tribunal decided that an EU citizen who does not qualify as a worker within Germany but worked in the Netherlands for a while cannot claim a residence status under the German Free Movement Act. He could however apply for a residence permit as a job-seeker in Germany or as an economically inactive EU citizen with sufficient resources provided he meets the criteria which the German law require for either category in line with EU law.3 _{In Greece frontier workers are entitled to social}

allowances depending on employment with one exception. A law on pension schemes from 2011 contains a residence clause. Pensions are only paid to those who have permanent resi- dence in Greece. The main issue of frontier work arises in relation to Bulgaria and there are no specific administrative or legal schemes in addition to the EU rules to address the situa- tion.

In Italy there is a residence requirement for access to social assistance benefits provided for by regional and municipal authorities. Social assistance laws in Latvia require permanent residency thus EU citizens and their family members are not entitled to many state flat-rate allowances, social assistance and social services even if they are employed in Latvia which runs contrary to Article 24 of Directive 2004/38/EC and Article 7(2) of the Regulation 492/2011. In Lithuania family benefits may be paid to a frontier worker based on the place of work and not residence, an issue, such as in the Hartmann case, should not arise there. The Council of State in Luxembourg has issued an opinion on the system of chèques-service. This system allows residents to apply with these cheques for services for their children, such as sports or places in kindergarten at a low cost, because of public subsidies. A residence clause in order to benefit from these subsidized services could possibly be held to be dis- crimination, but they are being granted not by the national government, but municipalities. The main issue regarding frontier workers in Luxembourg is access to study grants. It will be addressed in the section below on study grants. The Dutch Social Assistance system does not provide the possibility of additional social assistance benefits for frontier workers who work

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in the Netherlands, but earn less than the social minimum. According to the Commission this is not in line with the equal treatment provision of article 7 Regulation 492/2011. As a fol- low up to the Renneberg judgement outlined in last report, the State Secretary of Financial Affairs published a new decision in June 2012 that those EU citizens, who earn more than 90 % of their income in the Netherlands, can deduct the mortgage interest they pay for the house they own in another Member State.4 _{The above mentioned decision of the Appeal}

Court is being challenged at the moment before the Supreme Court. The Advocate General holds the opinion that the right of choice for foreign taxpayers is acceptable.5

There has not been any change in Poland where social benefits are residence related. According to the Voivode Administrative Court in Wroclaw in a judgement from 2009, it is not sufficient for an applicant for social benefits under the Act on Social Assistance from 2004 to be only resident in Poland. Poland shall also be the place where his/her center of vital interests is located.6 _{For access to higher education residence is required. However a}

non economically active family member of a frontier worker could access higher education without the right to financial benefits. In Romania EU citizens who are frontier workers are assigned a personal identification number without having to prove that they are resident in Romania and have access to social benefits. The requirement for residence in social security legislation is only applied to third-country nationals. In Slovakia, tax benefits for children are not connected with residence any more but an income criterion is applied where 90 % of the income of the person claiming tax benefits has to come from Slovakia. Almost all social benefits provided for in Slovak legislation are conditioned on permanent residency, indi- viduals in similar position as in the Hartmann case would therefore not be entitled to them in Slovakia. In Slovenia there are no specific administrative or legal rules concerning frontier workers, in addition to the EU rules and no information on practical problems. All frontier workers living in France or Portugal and working in Spain are excluded from the social as- sistance measures outlined in the Spanish Social Assistance Guide 2012 because they are not registered as residents in Spanish territory or in the Autonomous Community territory.

In a seminar held in 2012 which focused on cross-border work between Sweden and Denmark, situations where living in one state and working in the other could cause difficul- ties with access to social entitlements and labour market support were identified. The most obvious problems are coordination problems when a person is living in one state and is em- ployed part-time in a neighbouring state. Furthermore, if the possibility of financial support for participation in activation measures for unemployed people in Sweden is linked to how long a person has been out of work and has been participating in other activities, problems may arise if a person has been a worker or is a job-seeker in Denmark but not in Sweden. Hence, there may be a number of “combined” situations of residence, working periods, peri- ods of unemployment etc. where the right to access to social entitlements may be unclear.

A 2010 decision of the Portuguese government to toll some highways which affected Spanish frontier workers was criticized in the media in Portugal and the European Commis- sion opened an infringement procedure against Portugal while it considered that the exemp- tions, as well as the payment methods, were discriminatory against non-residents in Portugal and violated the “Eurovignette” Directive (2006/38/EC). On October 2012, the Portuguese government revoked the exemptions for residents and created new electronic toll payment methods for non-residents in Portugal. For that reason, on 21 March 2013, the Commission

4 Staatscourant 2012 nr. 11800, 14 June 2012.

5 Opinion Advocate-General 6 March 2013, LJN: BZ5779, Hoge Raad , CPG 12/02201.

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declared that it was closing the infringement procedure because it considered those measures as non-discriminatory.