The Court of Justice of the European Union (CJEU) ruled on several occasions that, while international double taxation may hinder the fundamental freedoms guaranteed by European Union (EU) law, it can nevertheless not be considered as a forbidden restriction to the extent that (direct) tax law is not harmonized. It is a result of the overlapping tax competences of the EU Member States. Conversely, in Switzerland, the Tribunal Fédéral held that inter-cantonal double taxation was contrary to the Swiss free movement of persons. In 2015 also the US Supreme Court decided in Maryland v. Wynne that interstate double taxation unconstitutionally discriminated against interstate commerce. The purpose of the current contribution is to compare the EU with the Swiss and the US fundamental freedoms in order to find a justification for these different approaches. Our comparative research shows that at least in certain circumstances international double taxation within the EU is contrary to the EU fundamental freedoms. We suggest a more comprehensive analysis following the example of the Swiss territory-based allocation rules and the US internal consistency test.
EC Tax Review