Company Size Matters

British Tax Review 5, 2019

42 Pages Posted: 11 Jan 2019 Last revised: 20 Dec 2019

See all articles by Ruth Mason

Ruth Mason

University of Virginia School of Law

Leopoldo Parada

University of Leeds School of Law

Date Written: December 16, 2019


Member States increasingly use classifications based on company size in their tax laws. Because bigger companies are more likely to be foreign, this article poses the question whether company-size classifications indirectly discriminate on the basis of nationality in violation of the fundamental freedoms. This article’s exploration of size-based classifications reveals important open doctrinal questions about the quantum and evidentiary burden required to show indirect discrimination, and about what role, if any, intent to discriminate plays or ought to play in discrimination cases. This article considers potential justifications for company-size-based classifications, including the justifications of administrability and the goal to tax companies on the basis of ability to pay. Although this article concludes that most company-size classifications can be justified, it argues that these justifications would be difficult to apply to recently enacted taxes on digital-services.

Keywords: EU law, digital services tax, disproportionate impact, company size, discriminatory intent

JEL Classification: K34

Suggested Citation

Mason, Ruth and Parada, Leopoldo, Company Size Matters (December 16, 2019). British Tax Review 5, 2019, Available at SSRN: or

Ruth Mason (Contact Author)

University of Virginia School of Law ( email )

United States

Leopoldo Parada

University of Leeds School of Law ( email )

Liberty Building
Belle Vue Road
Leeds, LS2 9JT
United Kingdom
+44 (0)113 343 9938 (Phone)

HOME PAGE: http://

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
PlumX Metrics