A company obtained final compensation for the costs of a bank guarantee letter used in the effort to suspend the enforcement of a tax assessment. The High Court of Cassation and Justice upheld the favorable decision for the taxpayer, according to a report published by JURIDICE.ro JURIDICE.ro. [1]
The dispute concerned the expenses for issuing and maintaining the bank guarantee, as well as the damage resulting from the inability to use the blocked funds according to the conditions imposed by the bank. The courts recognized, in this case, the link between the illegal tax decision and the losses suffered by the company. [1]
An important detail: at the time the compensation claim was filed, the tax assessment had already been partially annulled even in the administrative procedure for resolving the tax appeal. There was no judicial decision yet annulling it. [1]
The case shows that damage caused by an illegal tax decision may also include costs incurred to prevent its enforcement, not just the sums demanded by the Tax Authority. [1]
Recovery of these costs is not automatic, however. The solution relates to a separate compensation action and the specific circumstances of that particular company. For other taxpayers, evidence regarding the losses suffered and the link between those losses and the contested tax act will be crucial. [1]
The guarantee costs were treated as material damage, not merely as court costs. Moreover, suspension of enforcement must not be confused with annulment of the tax assessment: stopping enforcement and establishing the illegality of the act are distinct issues. [1]
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