9 July 2025 — Consultation Response
Savings and Investments Union (SIU), fostering integration, scale and efficient supervision in the single market
Accountancy Europe fully supports the European Commission’s Savings and Investments Union (‘SIU’) initiative and is pleased to present its views through the Call for Evidence.
We believe that the SIU could not only grow EU capital markets but call also help EU citizens save for the future and, particularly, for retirement.
Boosting retirement saving is an important policy objective, especially considering that nearly all EU countries are showing an increasing proportion of citizens over 65 years of age and increasing fiscal constraints.
Accountancy Europe believes that targeted tax incentives can help boost EU capital markets and incentivise citizens to prepare for the future by investing in assets with the potential for capital growth.
Targeted tax reliefs have been shown to be effective in persuading citizens to move funds from existing savings products to other products. Careful design of such tax reliefs could incentivise citizens to move investments away from low-growth cash-based products to equity-based products – thereby boosting investment in capital markets and potentially boosting the value of savings.
Studies indicate that tax regimes that grant tax relief on investment into pensions savings products where the funds grow free of tax but are subject to taxation when withdrawn can boost saving for retirement. These can be supported by tax advantageous regimes whereby funds invested do not attract tax relief at the point of investment but grow tax free and are tax free when withdrawn that support other medium- to long-term savings objectives.
Tax and social security reliefs granted to employers who provide pension schemes for their employees can also be an effective means of boosting retirement savings for lower-income employees.
Additionally, modernisation and better harmonisation of the tax treatment of investment vehicles in the EU could help reduce the risk of capital flight to non-EU markets. An important issue to be dealt with is the current VAT treatment of such vehicles, which increases the costs of EU based investment vehicles and, consequently, the yield offered to investors.
Finally, it should be examined whether the tax system can be used to incentivise more businesses to list on EU capital markets – at the very least, tax systems, should not actively disincentivise equity investment, particularly in smaller, higher risk, entities.
Any tax reliefs need to be carefully considered and implemented to ensure the best chance that the policy objectives are achieved, at the lowest cost to taxpayers. Issues of equity must be addressed so that lower-income households are not left out of policy decisions to boost retirement savings.
Additionally, tax reliefs cannot achieve everything. EU citizens demonstrate less willingness to invest in equities than in some of our major competitors and proper consideration of why this is the case is required – as well as suggestions for how this situation can be ameliorated.