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ECtHR / Application no. 49570/11 / Judgment

Gáll v Hungary

Deciding Body type:
European Court of Human Rights
Deciding Body:
European Court of Human Rights
Type:
Decision
Decision date:
25/06/2013
Key facts of the case:
  1. The applicant was born in 1954 and lives in Szolnok.
  2. The applicant, a civil servant for more than thirty years, had been in the service of the Hungarian Tax Authority. On 31 March 2011 she was dismissed, with effect from 1 June 2011. Her dismissal was part of a wave of similar measures throughout the entire civil service.
  3. On dismissal, the applicant was statutorily entitled to two months’ salary for April and May 2011, during which time she was exempted from working. In addition, she was to receive severance pay amounting to twelve months’ salary in application of section 19(2) of Act no. XXIII of 1992 on the Status of Civil Servants (see paragraph 8 below).
These benefits were subsequently taxed at 98% in their part exceeding 3,500,000 Hungarian forints (HUF)[1]. The exceeding part was HUF 3,903,529[2], the tax amounting to HUF 3,825,458[3]. This represented an overall tax burden of approximately 60% on the entirety of the severance, as opposed to the general personal income tax rate of 16% in the relevant period.
 
The tax amount in question was never disbursed to the applicant, but was withheld by the employer and directly transferred to the tax authority on 8 June 2011.
 
Results (sanctions) and key consequences of the case:
 
The Court unanimously
  1. Declares the complaints under Article 1 of Protocol No. 1, read alone and in conjunction with Article 14 of the Convention, admissible and the remainder of the application inadmissible;
  2. Holds that there has been a violation of Article 1 of Protocol No. 1;
  3. Holds that there is no need to examine separately the complaint under Article 1 of Protocol No. 1 read in conjunction with Article 14 of the Convention;
  4. Holds
(a)  that the respondent State is to pay the applicant, within three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, the following amounts, to be converted into the currency of the respondent State at the rate applicable at the date of settlement:
 
(i)  EUR 16,000 (sixteen thousand euros), plus any tax that may be chargeable, in respect of pecuniary and non-pecuniary damage;
 
(ii)  EUR 900 (nine hundred euros), plus any tax that may be chargeable to the applicant, in respect of costs and expenses;
 
(b)  that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;
  1. Dismisses the remainder of the applicant’s claim for just satisfaction.