Multinationals and fund managers with pan-European investments stand to cut their tax bills by hundreds of millions of euros if a preliminary ruling on Thursday by Europe’s highest court forces governments to reform “withholding” taxes on income being sent abroad.

Leendert Geelhoed, advocate-general at the European Court of Justice, said it was “quite patently discriminatory” that France was imposing a higher tax burden on dividends destined for a Dutch parent company than those distributed to French parent companies.