Austria / Supreme Administrative Court / Ra 2019/13/0111

Key facts of the case: 

The complainant earned income from renting flats. After reopening proceedings, the tax office issued amended income tax assessments and VAT assessments. On 10 November and 15 November 2015, the appellant filed appeals against the reopening and the substantive assessments and at the same time filed and application for the granting of legal aid (Prozesskostenhilfe) - without citing a legal provision.
In the contested decision, the Federal Finance Court rejected the appellant's applications for legal aid - which the Federal Finance Court considered to be applications pursuant to § 292 Federal Tax Code (Bundesabgabenordnung). The Federal Finance Court stated that applications for the granting of legal aid pursuant to § 292 Federal Tax Code could only be considered from 1 January 2017 onwards (which is the date on which this provision came into force). At the time the appellant filed the application (which was 10 November and 15 November 2015, respectively, and thus before the aforementioned provision entered into force), applications under § 292 Federal Tax Code had therefore not been admissible "for lack of a legal basis". The applications were therefore rejected. The appeal contested this decision by the Federal Finance Court.

Key legal question raised by the Court: 

The complainant claims that there is a lack of case law of the Supreme Administrative Court on the temporal scope of § 292 Federal Tax Code regulating legal aid, and that the decision of the Federal Finance Court deviates from the case law of the Supreme Administrative Court on the direct applicability of Union law (in particular the Charter of Fundamental Rights of the European Union - CFR) in the absence of corresponding domestic provisions.

Outcome of the case: 

The Supreme Administrative Court found that the rejection of the application for procedural assistance was inadmissible for procedural reasons: Since § 292 Federal Tax Code had entred into force on 1 January 2017, the Supreme Finance Court was required to rule on the matter ex officio. For this reason alone, the contested decision was therefore to be set aside due to the unlawfulness of its content. 
In addition, the Supreme Administrative Court found that the appellant is also partially correct (namely in respect to the VAT) with the argument that the right to legal aid arises directly from Article 47 CFR, even in the absence of a "domestic legal basis" and thus irrespective of the question of the applicability of § 292 Federal Tax Code.
The Supreme Administrative Court ruled that while tax proceedings do not fall within the scope of application of Article 6 (1) ECHR, the fundamental rights guaranteed by the Charter must be respected "when implementing Union law" according to Article 51 (1) CFR. As VAT proceedings fall within the scope of application of Union law according to the case law of the Supreme Administrative Court, the procedural guarantees resulting from Article 47 CFR, such as the right to legal aid, must be taken into account for such tax proceedings. In the absence of specific national provisions implementing the procedural guarantees of the CFR within the scope of application of Union law, the assertion of the fundamental rights guaranteed by the CFR can be directly based on Article 47 CFR. This also applies in particular to the right to legal aid.

The Supreme Administrative Court set aside the contested decision on the grounds that its content is unlawful. The state shall reimburse the party filing the appeal with the amount of € 1,106.40 within two weeks.