Sweden’s Dividend Tax Rules Breach EU Law, ECJ Adviser Says

Sweden can’t require loss‑making nonresident companies that are dividend recipients to recalculate their results under Swedish tax rules in order to get the dividend withholding tax deferral and refund mechanism available to domestic companies, according to an adviser to the European Court of Justice.

In a nonbinding opinion that favors French bank Société Générale SA, Advocate General Jean Richard de la Tour wrote that the Swedish restriction can’t be justified by arguments about balanced allocation of taxing rights, fiscal cohesion, or tax avoidance.

He called the tax avoidance argument “disproportionate to the objective pursued” and ...