J.B. - Switzerland (Nº 31827/96)

*Judgment 3.5.2001 [Section II]

Facts: Tax evasion proceedings were brought against the applicant by the District Tax Commission, which requested him to submit all documents relating to investments in particular companies. The applicant admitted that he had made investments without properly declaring the income, but did not submit the documents. When again requested to declare the source of the income, he did not reply. The District Tax Commission decided to issue a supplementary tax but later withdrew this. After the applicant had failed to reply to two further requests, the Cantonal Administration imposed a disciplinary fine of 1,000 Swiss francs. The District Tax Commission admonished the applicant on four occasions as he still had not submitted the required information and then imposed two further disciplinary fines of 2,000 Swiss francs. The applicant's appeal against the second fine was dismissed by the Tax Appeals Commission. He then filed an administrative law appeal with the Federal Court, which dismissed the appeal. A fourth fine was subsequently imposed but did not acquire legal force. In the meantime, the applicant and the tax authorities had reached an agreement closing all tax and criminal proceedings and fixing the amount to be paid by the applicant, including a fine of over 20,000 Swiss francs. It was expressly stated that the proceedings before the European Court of Human Rights would not be affected.

Law: Article 6(1) – The proceedings at issue served the purposes both of establishing the taxes due by the applicant and, if the conditions were met, of imposing a supplementary tax and a fine for tax evasion on him. Nevertheless, the proceedings were not expressly classified as constituting either supplementary tax proceedings or tax evasion proceedings. From the beginning and throughout the proceedings the tax authorities could have imposed a fine on the applicant on account of the criminal offence of tax evasion and, according to the settlement, the applicant incurred such a fine, which was not intended as pecuniary compensation but was essentially punitive and deterrent in nature. Moreover, the amount was not inconsiderable and there can be no doubt that it was "penal" in character. Whatever other purposes the proceedings served, by enabling the imposition of such a fine they determined a criminal charge. Article 6 therefore applies.

It appears that the authorities were attempting to compel the applicant to submit documents which would have provided information as to his income in view of the assessment of his taxes. While it is not for the Court to speculate on what the nature of such information would have been, the applicant could not exclude that any additional income which it transpired from the documents came from untaxed sources would have constituted the offence of tax evasion. While an agreement was reached which closed the various proceedings, it expressly excluded the application to the Court. The situation in the present case differs from that in which there is an obligation to produce material which has an existence independent of the person concerned, such as a blood test.  Moreover, in view of the persistence with which the tax authorities attempted to achieve their aim, the Court was unconvinced by the argument that the applicant was not obliged to incriminate himself since the authorities were in fact already aware of the information. Finally, as to the alleged impracticability of a separation of regular tax and criminal tax proceedings, it is not the Court's task to indicate what means a State should use in order to fulfil its obligations under the Convention.

Conclusion: violation (unanimously).

Article 41 – The Court ordered reimbursement of the fine which the applicant had contested before the Federal Court. It also made an award in respect of costs and expenses.