The European Commission has referred the United Kingdom to the EU's Court of Justice for abolishing the "remedy for repayment of taxes paid in mistake of law" without implementing proper transitional measures.
Under EU law, taxes must be reimbursed when such taxes have been levied in breach of EU rules and should be repaid according to the national rules on internal tax reimbursements. The procedure for refunding such taxes should not be excessively difficult.
In FA 2007, the UK retroactively abolished one of the remedies used by taxpayers seeking reimbursement of taxes paid in breach of EU law. According to the Commission, no proper transitional rules are provided for and as a result, it is practically impossible in certain cases to exercise the rights conferred by EU law. The Commission has stated that the UK’s actions are in breach of EU rules as the provision in FA 2007 exceeds the limits of national procedural autonomy under Article 4(3) of the Treaty on the European Union.
On 30 September 2010 the Commission formally requested the United Kingdom to ensure compliance with the EU rules. However the matter has not been resolved to the satisfaction of the Commission and will therefore progress to the ECJ.
For full details see here.