The EU Court of Justice holds that a tax exemption may not constitute State aid if it is justified by reasons linked to the nature or general scheme of the tax system (Finanzamt / A-Brauerei)

Justification of a Tax Exemption* Prevention of excessive taxation may justify tax exemption. Prevention of abuse may justify limits to the tax exemption. Introduction A tax exemption may not constitute state aid if it is justified by reasons which are linked to the nature or general scheme of the tax system. This is what the Court of Justice said on 19 December 2018, in a preliminary ruling in case C374/17, Finanzamt v A-Brauerei. The case arose from a dispute between A-Brauerei, a German company, and Finanzamt which refused to grant an exemption from a property transfer tax. The exemption is allowed when companies acquire property in the context of restructuring procedures within groups of companies. In Germany, companies may be restructured through merger, division or asset