On February 19th, 2018, the Spanish Supreme Court issued a judgment establishing that the State Law on Inheritance and Gifts constitutes a restriction on the free movement of capital for the purposes of Article 63 TFEU, as it does not allow non-EU citizens to apply the tax benefits of the different Autonomous Communities.
According to the judgment of September 3rd, 2014 of the CJEU, the State Law on Inheritance and Gifts was modified as of January 1st, 2015, so that residents in the European Union and the European Economic Area could take advantage from the tax benefits of the Autonomous Communities with which they had a certain connection, for instance, the place of residence of the deceased or of the heirs or the location of the assets in Spain.
But it has been the recent Supreme Court Judgment of February 19th, the one that has actually broken the barrier of discrimination also for non-EU citizens, that is, non-residents in the European Union or in the European Economic Area.
In such Judgment the financial liability against the State is also declared in the present case, and it obliges the Spanish State to return the difference between what the heir paid by applying the state regulations and what he should have paid if the autonomic regulations applied, in particular, that of the Autonomous Community of Catalonia.
As a result, the recent Judgment seems to support that non-EU taxpayers can choose between requesting the return of taxes from prescribed financial years by means of the declaration of liability of the state, or requesting the return of non-prescribed taxes through the income refund request.