The way Portugal charges Vehicle Tax (ISV) on cars imported from other European Union countries is illegal, concluded the Court of Justice of the European Union (CJEU).

The method of collection was changed in 2021 in Parliament, following a proposal from the Government and the PS, but, most likely, it will have to be changed again, with a partial refund of the tax according to a report by Público.

The court declared that the discount on cylinder capacity and the environmental part must be the same for second-hand cars imported from another country in the European bloc, which is not currently in place as the Tax Authority has applied different rates.

The European Commission must comment on the complaint filed in Brussels through a reasoned opinion that must comply with the CJEU's position. If so, Portugal will still have a few weeks to respond. But, failing to convince European entities, it will have to change the way this tax is charged.

Taxpayers who purchased a used car from another country in the bloc after January 1, 2021, will be able to recover part of the money, as long as they complain to the Tax Authority or challenge it in court. This is said to affect almost 280,000 cars.