Published on 6 December 2021

FIRST SECTION

Application no. 13402/19 Piotr NAGÓRNY against Poland lodged on 26 February 2019 communicated on 17 November 2021

STATEMENT OF FACTS

The applicant, Mr Piotr Nagórny, is a Polish national who was born in 1981 and lives in Wiewiórczyn.

The facts of the case, as submitted by the applicant, may be summarised as follows.

The applicant is a professional soldier in the Polish Army. Between 1 August 2005 and 31 July 2008 he was delegated to serve in a NATO command in the Netherlands, pursuant to an order issued by the Chief of General Staff of the Polish Army ( Szef Sztabu Generalnego Wojska Polskiego ).

Due to his service abroad, he was entitled to an additional monthly foreign supplement ( należność zagraniczna ) which was paid in euros (EUR). As well as the supplement, he also received his regular remuneration ( uposażenie ) in Polish zloty (PLN). Both were subject to taxation in Poland.

The applicant had doubts as to whether the taxation of the foreign supplement had been compliant with the law and on 13 September 2007 applied to the Minister of Finance ( Minister Finansów ) for an individual interpretation of the tax law.

On 12 December 2007, the Director of the Warsaw Tax Chamber ( Dyrektor Izby Skarbowej ), acting under the authority of the Minister of Finance, issued an interpretation which stated that the foreign supplement was subject to taxation. The applicant did not appeal against that decision and paid his personal income tax contributions for the years 2005 – 2008. He included the foreign supplement as a basis for taxation.

On 11 December 2013 the Minister of Finance, acting proprio motu , issued a decision in which he changed his interpretation included in the decision of 12 December 2007. The Minister held that the foreign supplement had been exempt from personal income tax and that the previous interpretation had been incorrect. The decision was served on the applicant in early 2014.

On an unspecified date thereafter, the applicant was reimbursed overpaid personal income tax for 2008.

On an unspecified date in early 2014 the applicant was refused the reimbursement of overpaid personal income tax contributions for the years 2005 – 2007 due to the expiry of the limitation period. The total amount was PLN 71,306 (approx. 17,000 EUR).

On 5 May 2014 the applicant requested the State Treasury – the Minister of Finance - to reimburse him the outstanding sum. His request remained unanswered.

On 2 June 2014 the applicant lodged a civil claim with the Warsaw Regional Court ( Sąd Okręgowy ), claiming the amount of overpaid tax in compensation.

On 9 March 2015 that court rejected his claim and held that he should have had recourse to administrative proceedings if he wanted to challenge an unfavourable tax decision.

The applicant’s interlocutory appeal ( zażalenie ) was dismissed by the Warsaw Court of Appeal ( Sąd Apelacyjny ) on 21 May 2015.

On 27 October 2015 the applicant applied to the Head of the Zielona Góra Tax Office ( Naczelnik Urzędu Skarbowego ) to determine an overpayment of personal income tax for the years 2005 – 2007. He indicated that the overpayment was a result of a change of interpretation of the tax law and no fault of his own.

On 23 November 2015 the Head of the Zielona Góra Tax Office refused to initiate tax proceedings pursuant to the applicant’s request, having determined that tax obligations for these years had become time-barred.

The applicant appealed to the Director of the Zielona Góra Tax Chamber. He also requested reinstatement of the time-limit to rectify his tax declarations for 2005 – 2007. In his appeal the applicant submitted that the limitation period had expired due to the fault of the tax authorities. He further stressed that he should not bear the negative consequences of incorrect application and interpretation of the law by public authorities.

On 11 February 2016 the Director of the Zielona Góra Tax Chamber dismissed his appeal. It held that the limitation period concerning tax obligations for the years 2005 – 2007 had expired, respectively, at the end of 2011 – 2013. Referring to the change in interpretation of the tax law, the organ stated that individual interpretations were merely of informative value to the taxpayer and provided guarantees that no negative consequences would arise, should the individual act in compliance with the interpretation. It held that in the applicant’s case, no negative consequences had arisen.

The applicant appealed against that decision. On 2 June 2016 the Gorzów Wielkopolski Regional Administrative Court ( Wojewódzki Sąd Administracyjny ) dismissed his appeal against the decision of the Director of the Zielona Góra Tax Chamber. The court held that the applicant’s claim for reimbursement of overpaid tax had become time-barred. It referred to the general limitation period of tax obligations, which was not subject to reinstatement and equally applied to both tax authorities, as well as taxpayers. The court further noted that a change in interpretation of the tax law did not result in a breach of the principle of trust in tax authorities ( zasada zaufania do organów podatkowych ).

Pursuant to the applicant’s request, on 19 July 2016 the Ombudsman ( Rzecznik Praw Obywatelskich ) lodged a cassation appeal on his behalf with the Supreme Administrative Court ( Naczelny Sąd Administracyjny ). He argued, in particular, that in the case of a change of interpretation of the tax law, the principle of non-deterioration of the taxpayer’s situation ( zasada nieszkodzenia ) required the tax authorities to disregard the limitation period in favour of the taxpayer, who followed an individual interpretation.

On 29 August 2018 the Supreme Administrative Court dismissed the cassation appeal. It held that the application of the principle of non ‑ deterioration could not override the general principles of the tax law, such as limitation periods. It noted that individual interpretation had to be distinguished from ordinary acts of application of the tax law, which had more direct results. Lastly, the court indicated that the applicant could seek compensation from the State Treasury in civil proceedings.

Section 79 § 2 of the Act on Tax Ordinance ( ustawa ordynacja podatkowa ), as applicable at that time, stated:

“The right to apply for determination of overpayment expires after the tax obligation had become time-barred.”

Section 14k of that Act, in so far as relevant, provides:

“§ 1. Acting in compliance with an individual interpretation prior to its change, (...) may not harm the applicant; as well as refusal to consider it in ruling over a tax matter.”

Section 70 § 1 of that Act provides:

“Tax obligation becomes time-barred after expiry of 5 years, counting from the end of the calendar year in which its payment became overdue.”

COMPLAINTS

The applicant complains of being unable to obtain reimbursement of overpaid personal income tax contributions. He relies on Article 6 § 1 read in conjunction with Article 13 of the Convention.

QUESTIONS TO THE PARTIES

1. Did the applicant’s claim for reimbursement of overpaid personal income tax constitute a “possession” in the sense of Article 1 of Protocol No. 1 to the Convention (see, mutatis mutandis , S.A. Dangeville v. France , no. 36677/97, 16 April 2002, § 48)?

2. If so, has there been an interference with the applicant’s peaceful enjoyment of possessions, within the meaning of Article 1 of Protocol No. 1?

3. In the affirmative, did that interference take place in the public interest and in accordance with the conditions provided for by law, within the meaning of Article 1 of Protocol No. 1 (see Beyeler v. Italy [GC], no. 33202/96, § 107, ECHR 2000-I) ?