Take a moment to explore all of Accountancy Europe’s published resources on tax to date!
We'll be back in September. Don't forget to subscribe to our policy updates so you won’t miss a thing when we return
Accountancy Europe is launching a new sponsorship opportunity! Your message could be featured in our next policy update, reaching a broad professional audience across Europe and beyond.
For more information, contact us at [email protected]
In the June tax policy update, it was mistakenly reported that the European Parliament (EP) was fast-tracking its VAT in the Digital Age (ViDA) opinion adoption. This was a mistake, as the EP has already adopted its final ViDA opinion and the final ViDA legal text was published in the EU Official Journal in March this year.
Instead, the article in question was about the proposal on taxable persons, special scheme and special arrangements for declaration and payment, relating to distance sales of imported goods. This is a separate initiative albeit building on the broader ViDA legislation.
The EP’s work on it is being led by MEP Ľudovít Ódor’s (RE, Slovakia) and indeed the EP has decided to follow the fast-track procedure for it (see article below).
The European Commission (EC) published on 16 July its long-awaited proposals for a new EU long-term budget (Multiannual Financial Framework, or MFF) totalling nearly EUR 2 trillion (or 1.26% of the EU’s gross national income on average) for 2028-2034. That same day, Accountancy Europe published its statement with 5 key principles to help ensure the MFF’s success.
Monetary increases in new MFF proposals are common and usually reflect inflation. This time, however, extra budget pressures come from the EU’s COVID recovery debt – around EUR 168 billion that EC will need to reimburse between 2028 and 2034, along with rising investments needs in digital, sustainability, and defence. Both the EP and the Council must approve the new budget, with tense negotiations expected to continue into 2027.
The MFF is, to put it simply, financed through member states’ contributions and “own resources” like customs duties and VAT based income. The EC now proposes adding 5 new own resources:
Member states must approve the new own resources unanimously, whilst the EP will need to provide its non-binding opinion.
The EC published a public consultation inviting stakeholder feedback on the downstream expansion, anti-circumvention measures and rules on electricity emissions of the EU’s Carbon Border Adjustment Mechanism (CBAM), on 1 July.
The consultation aims to gather stakeholder views on the policy design of the elements outlined above, including on their potential social, economic, environmental, and administrative impacts.
The deadline for feedback is 26 August.
The EC published its non-binding guidance and recommendations for member states on the use of tax measures to foster the clean industry transformation, on 2 July.
The EC suggests allowing companies to quickly deduct the full cost of investments in clean technologies – like renewable energy systems or energy-efficient machines. This could be done all at once in the year of purchase or lease.
The guidance also proposes direct corporate tax liabilities cuts, to encourage investments in strategic sectors, such as manufacturing of clean technologies and industrial decarbonisation projects. Where feasible, the EC advises member states to make the tax credits refundable or usable against other national taxes.
All the provisions should be aligned with the Clean Industrial State Aid Framework (CISAF).
The EC announced a new Implementing Regulation aimed at providing the technical solution for the automatic exchange of top-up tax information return between Member States under the Directive on Administrative Cooperation (DAC9) on 7 July.
According to the EC’s statement, the new Implementing Regulation lays down a common IT schema based on the one developed by the OECD. The EC expects this to ensure full interoperability between reporting under DAC9 and the OECD framework, thereby minimising the administrative burden on tax authorities and businesses alike.
At the time of writing, however, the actual legal text of this Implementing Regulation was still not available.
The EC launched a public consultation on the so-called 28th regime for companies on 8 July. This initiative would provide companies, especially innovative ones, with a single set of rules to invest more easily and operate in the Single Market.
As a main element, it will set out a new optional corporate legal framework, co-existing with the current 27 EU member states’ regimes, that covers a wide range of key issues for companies, building on online procedures and digital tools in EU company law. This framework will be complemented by measures in other areas to help innovative companies develop in the EU.
Although not the main focus, the questionnaire includes a few questions on taxation – namely, existing tax barriers to cross-border business in the Single Market and possible tax support for companies joining the 28th regime.
The consultation deadline is 30 September. A legislative proposal is currently expected for March 2026.
The EU’s VAT Committee, constituting of representatives from the EC and the member states, issued updated non-binding guidelines on 15 July.
These guidelines offer interpretative guidance for taxable persons, tax inspectors and other stakeholders when navigating recent EU VAT legislation and case law. Notably, the latest update covers changes in e-invoicing rules applicable upon the entry into force of the VAT in the Digital Age Directive (ViDA).
The European Parliament (EP) plenary approved a legislative package of measures on VAT in the Digital Age (ViDA) by 623 votes to 26, with 28 abstentions (relating to the corrigendum article above). The vote was a follow-up to the opinion of rapporteur MEP Ľudovít Ódor (RE, Slovakia), who had proposed a simplified procedure without amendments.
The EP was consulted again after EU finance ministers, in March, approved a version of the proposal that differed significantly from the original. Instead of making the one-stop shop for imports (IOSS) mandatory, they opted for an incentive to encourage suppliers and platforms liable for VAT on imports to use IOSS.
The EP’s vote means that the finance ministers’ agreement can be finalised and published in the EU Official Journal.
The ECON Committee adopted recommendations for reforms to the EU tax architecture to boost competitiveness while continuing to address tax avoidance and evasion, on 15 July.
The draft report, prepared by MEP Michalis Hadjipantela (EPP, Cyprus), was adopted by 46 votes in favour, 2 votes against and 11 abstentions. The report is part of the ongoing legislative simplification process, which will result in a dedicated EC tax omnibus proposal in early 2026.
The report contains ideas for simplifying tax compliance and eliminating administrative hurdles in the internal market. This would reduce the financial cost of tax compliance, especially for SMEs, where 30% of their tax costs are linked to compliance. The suggestions would also help governments collect taxes more easily, reduce evasion and avoidance, and free up funds for other investments. Accountancy Europe was pleased to contribute ideas to the report.
As a next and final step, the EP plenary will vote on the report on 8 September.
The Council formally adopted on 18 July new VAT rules for distance sales of imported goods. The directive aims to improve VAT collection on imported goods by ensuring suppliers are always liable for VAT paid on imports, rather than the EU consumer as is currently usual practice. This should encourage suppliers outside the EU to use the VAT import one-stop-shop (IOSS) for VAT reporting and collection.
As the EP has also provided its opinion on the directive (see article above), it can now be published in the EU Official Journal and will enter into force twenty days later. The rules will apply from 1 July 2028.
G7 countries reached a compromise on the global minimum corporate tax on 28 June. Previously, the US under President Trump had threatened to exit the 2021 OECD-brokered tax deal, and impose a ‘revenge tax’ on countries applying the global minimum tax to US companies. The new G7 agreement removes that threat for now, but allows a ‘side-by-side’ system that gives some protection to US companies.
OECD’s Secretary-General welcomed the agreement in a statement the same day, and noted ongoing work with the Inclusive Framework on its features.
Pascal Saint-Amans, former OECD head of taxation, said the agreement could be seen as a defeat for Europe and other G7 countries, as they have accepted a carve-out for US businesses. He argued this concession rewards US threats and weakens Europe’s position against the US. Still, it may surprise those who believed the global minimum tax would not survive a second Trump term.
Canada announced it would drop its planned digital services tax to restart stalled trade talks with the U.S.
The tax, targeting revenues from Canadian online users and set to begin on 30 June, had angered Donald Trump, who called it “a direct and blatant attack” on the U.S. and ended trade talks with Canada.
After his government folded on the tax, Canadian Prime Minister Mark Carney and the Trump administration agreed to resume trade talks, aiming to reach a deal by 21 July, according to Canada’s Department of Finance.
European Parliament
European Parliament publishes study on need for 28th regime, including tax elements
Agence Europe
Danish Presidency of EU Council hopes to reach an agreement on energy taxation at November Ecofin Council
International
Spain and Brazil present an initiative to promote a more effective taxation of the super-rich worldwide
