Spain in court for unfair tax on foreign lottery winners

6 July 2007

BRUSSELS – The European Commission said Friday it would take Spain to court for taxing foreign lottery wins while Spanish lottery prize-winners get a tax-free bonanza.

EU regulators said this discriminated against lotteries based in other countries and violated EU rules that guarantee the right to do business anywhere in the 27-nation bloc.

They said they had asked Spain to change its system last year, but Madrid refused.

Spanish rules give a tax exemption to cash prizes doled out by the state lottery, national and regional gaming agencies and draws organized by the Spanish Red Cross and the Spanish National Association of the Blind.

All other lottery wins must pay normal income tax.

The European Court of Justice can order Spain to change its laws under threat of daily fines.

[Copyright AP with Expatica]

Subject: Spanish news