Tax-free for railroad companies: ECJ ruling
ECJ confirms property tax exemption for railroad infrastructure in Poland
The European Court of Justice (ECJ) has ruled in a recent judgment (dated 29.04.2025, ref. C-453/23, Prezydent Miasta Mielca) that the Polish property tax exemption for land, buildings and structures in the area of railroad infrastructure does not constitute unlawful state aid.
What exactly was it about?
As part of a request for a preliminary ruling by the Polish Supreme Administrative Court (Naczelny Sąd Administracyjny), the ECJ had to clarify whether the tax concession in favor of railroad companies provides a selective advantage within the meaning of EU state aid law (Art. 107 TFEU) and is therefore to be assessed as state aid.
The ruling: No aid in the case of a neutral tax regime
The ECJ denied a classification as state aid. According to the court, a state measure only constitutes aid within the meaning of Art. 107 TFEU if it:
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is granted from state funds,
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a selective advantage and
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distorts or threatens to distort competition.
In the case decided, the tax exemption is part of the general Polish tax system and is based on a neutral criterion that applies regardless of the economic sector, economic activity or legal form of the companies. The exemption is therefore based solely on the function of the land and buildings as part of the railroad infrastructure – not on which company uses them.
Conclusion
This means that the Polish tax concession remains in line with EU state aid law. With its decision, the ECJ strengthens national leeway for general tax measures as long as they do not selectively benefit certain companies or sectors.
