GAARs vs. Tax Havens: Testing the Boundaries of EU Law
GAARs vs. Tax Havens: Testing the Boundaries of EU Law

Summary/Abstract: In recent years, the fight against tax avoidance has become a debated area of EU tax law. At the heart of this debate lies the question: how can Member States enforce effective anti‑abuse measures, such as General Anti‑Avoidance Rules (GAARs), while remaining consistent with the freedoms guaranteed by the EU Treaties? [2] At the same time, global scrutiny of tax havens has intensified, putting pressure on the EU and its Member States to adopt stricter rules. As it is proven by relatively recent cases, these efforts often lead to legal uncertainty, because the boundaries between legitimate tax planning, aggressive tax avoidance, and unlawful abuse are not always clearly defined. This article explores how anti‑avoidance measures interact with EU law, particularly in relation to the freedom of establishment and free movement of capital. Drawing on case law from the Court of Justice of the European Union (CJEU), it is examined how the concept of abuse has evolved, where current legal frameworks fall short, and how different Member States have implemented EU rules such as the Anti‑Tax Avoidance Directive (ATAD). It also considers whether recent proposals, like mandatory disclosure regimes such as DAC6, represent meaningful steps forward or introduce new challenges.

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