European Court rules against Greece's first-time buyer tax relief

The European Court of Justice ruled, on 20 January 2011, that the Greek government is behaving illegally by allowing Greek residents to buy their first property tax-free, while taxing foreigners on similar purchases.

The European Commission asserts that the exemption is counter to EU treaty principles that EU nationals should be able to move freely between member states without penalty. The Commission first formally notified its objection to the Greek rule in December 2007, and again in September 2008. On both occasions the Greek government rejected the Commission's view.

The ECJ proceeded to a final judgment without first obtaining a preliminary opinion. It found that the exemption – which is available both to Greek citizens who are resident in Greece at the date of purchase of the property, as well as those who are not resident in Greece but are of Greek origin – was explicitly discriminatory on nationality as well as residence grounds.