European Court of Justice Issues Advocate General Opinion on Lithuanian Dividend Taxation Under Parent-Subsidiary Directive

The European Court of Justice (ECJ) May 21 issued an Advocate General opinion for Case No. C-203/25, on Lithuanian dividend tax under the EU Parent-Subsidiary Directive (Directive). The taxpayer, a Lithuanian company with its parent company organized in Cyprus, sought a withholding tax exemption on dividends it paid to the parent company. The Lithuanian tax authorities denied the exemption, finding that the distributions to the parent company were part of a non-genuine arrangement. Upon request for a preliminary ruling, the Advocate General opined that: 1) even if the parent company was the beneficial owner of the distribution, the Directive allows ...