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New EU system for the avoidance of double taxation in the field of withholding taxes

Taxation

Fostering cross-border investment and simplifying taxation is one of the priorities of the European Commission. Despite actions already undertaken, tax barriers to cross-border investment still persist within the EU. This initiative proposes introducing a common, standardised, EU-wide system for withholding tax relief at source. A system for exchange of information and cooperation between tax authorities will complement the initiative.

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Public consultation

ID: 13031

Lobbying Activity

48 responses

AmCham EU urges uniform EU withholding tax procedures

American Chamber of Commerce to the European Union, 18 Sept 2023

The organization calls for a consistent EU-wide process to replace fragmented national systems. They request common rules for identifying owners and simpler checks for foreign investors. They also advocate for uniform liability rules to reduce risks for banks.
Standardised procedures would lower administrative costs and reduce legal exposure for major financial institutions.

Consultation response

Insurance Europe, 25 Oct 2021

Insurance Europe welcomes the possibility to comment on this roadmap. Provisions around withholding tax procedures for cross-border portfolio investors or shareholders in the EU, which are different between member states, often pose a challenge to insurers in regard to cross-border investment, due…

Financial Industry Seeks Clearer Rules on EU Withholding Tax Reform

Association for Financial Markets in Europe, 18 Sept 2023

AFME requests clear, consistent reporting requirements and due diligence obligations across Member States, with a single EU-wide portal for registration and reporting. They emphasize that liability rules must recognize the limits of financial intermediaries' visibility into investor activities. The organization also seeks clarification on key definitions including beneficial ownership, financial arrangements, and holding periods.
This would reduce their compliance costs and operational complexity across twenty-seven countries.
Tax authorities could lose revenue if intermediaries lack visibility into abusive arrangements.

Financial industry urges clear beneficial ownership rules for withholding tax

Association for Financial Markets in Europe, 26 Oct 2021

AFME requests clear and consistent beneficial ownership requirements alongside procedural improvements. They argue current uncertainty leads to lengthy disputes and inconsistent outcomes across member states.
This would reduce lengthy disputes and provide certainty for their members' tax reclaim processes.
Tax authorities lose flexibility to challenge claims on beneficial ownership grounds retrospectively.

Banking federation urges optional withholding tax relief scheme

European Banking Federation, 18 Sept 2023

The EBF requests that participation as a Certified Financial Intermediary remain optional rather than mandatory, with simplified due diligence requirements and longer reporting timelines. They argue the proposed obligations are "even more burdensome than those currently in application" and want CFIs to be "free to decide for which countries they want to offer this tax relief service."
This would reduce their administrative burden and compliance costs significantly.
Cross-border investors lose faster access to withholding tax refunds and relief.

French business group MEDEF urges broader withholding tax reforms

Mouvement des Entreprises de France, 18 Sept 2023

MEDEF requests the inclusion of non-intermediated flows like intra-group dividends and royalties. They propose prioritizing a standardized electronic residency certificate to reduce administrative burdens. Finally, the group suggests a progressive approach to ensure the system remains workable.
This would reduce compliance costs and prevent the dismantling of existing efficient national systems.
Financial intermediaries risk significant legal liability and operational costs due to vague negligence definitions.

Consultation response

Mouvement des Entreprises de France, 25 Oct 2021

Mouvement des Entreprises de France (MEDEF) welcomes the European Commission's initiative to address the issue of burdensome withholding tax relief procedures for cross-border investors with respect to certain types of income (mainly dividends, interest and royalties). This is a long-standing…

Consultation response

Association Française des Entreprises Privées / French Association of Large Companies, 26 Oct 2021

The French Association of Large Companies (AFEP) welcomes the opportunity to answer this consultation on the Commission's roadmap. This initiative is particularly welcomed by French large companies in a context where Member States are multiplying domestic measures to restrain access to these…

Consultation response

Finanssiala ry - Finance Finland, 26 Oct 2021

Finance Finland welcomes the European Commission’s initiative to introduce a common EU-wide system for withholding tax on dividend payments. Complicated and different withholding tax processes form a substantial barrier to cross-border investments within the EU and it is important that withholding…

Invest Europe urges uniform EU-wide withholding tax relief rules

Invest Europe, 18 Sept 2023

The organization calls for more clarity and uniformity in the legislation to ensure national interpretations are limited. They suggest expanding the definition of dividends and allowing non-EU financial intermediaries to qualify for relief benefits.
Faster refund procedures would reduce administrative costs and lower tax barriers for cross-border investors.
Member States lose tax sovereignty as the proposal limits their ability to apply national regulations.

Consultation response

Invest Europe, 26 Oct 2021

Invest Europe welcomes the European Commission’s initiative to investigate a common EU-wide system for withholding tax on dividend or interest payments, as we encourage the idea of removing tax barriers to cross-border investment. We support the principles of tax simplification and closure of…

Italian Banking Association urges clearer definitions and implementation delays

Associazione Bancaria Italiana, 18 Sept 2023

ABI requests a precise beneficial owner definition and voluntary registration for intermediaries. They also advocate for an eighteen-month delay following national transposition.
These changes would lower administrative costs and prevent burdensome compulsory reporting requirements.
Small investors may lose access to services if banks withdraw from markets.

EY Urges Balanced Rules for EU Withholding Tax Reform

Ernst & Young Core Business Services BV, 18 Sept 2023

EY supports a digital tax system but seeks clarity on who qualifies for benefits. They suggest removing optional exemptions that might exclude low-risk investors from fast-track procedures. The firm also urges standardized implementation to prevent fragmented national rules.
Standardization would reduce administrative costs and legal uncertainty for EY and its clients.
Member States lose the ability to apply divergent, custom rules that currently create fragmentation.

Consultation response

Ernst & Young Core Business Services BV, 26 Oct 2021

We appreciate the opportunity to submit comments on behalf of EY on the European Commission’s Roadmap of 28 September on “Withholding taxes – new EU system to avoid double taxation”. Please find attached our submission in PDF format.

Deutsche Börse Group calls for clearer EU tax relief rules

Deutsche Börse AG, 8 Sept 2023

The group requests unambiguous definitions and the creation of a reconciliation process. They seek clarity on financial institutions' liability and specific considerations for central counterparties.
Clarifying liability and clearing house roles reduces legal risks and operational costs.
Non-EU financial intermediaries may face significant uncertainty regarding reporting and compliance requirements.

Consultation response

Investment Company Institute, 25 Oct 2021

The Investment Company Institute (ICI), including ICI Global—on behalf of collective investment vehicle (CIV) investors— supports strongly a widely applicable, practical, and reliable mechanism for providing investors with appropriate treaty relief. The varied procedural requirements imposed…

Co-operative banks urge clearer liability in EU tax relief plan

European Association of Co-operative Banks, 18 Sept 2023

The association requests clear liability standards for banks and the ability to charge service fees. They believe banks should only report information they already hold.
Clearer rules and restricted reporting would reduce operational burdens and legal uncertainty.
Investors may face higher costs if banks charge fees for processing tax refunds.

Consultation response

European Association of Co-operative Banks, 26 Oct 2021

The members of the European Association of Co-operative Banks (EACB) gladly take the opportunity to comment on the European Commission’s roadmap consultation “New EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes”. We appreciate the…

ESBG warns EU tax proposal creates burdensome bank liability

European Savings and Retail Banking Group, 13 Sept 2023

ESBG seeks a uniform definition of owners to prevent national inconsistencies. They demand a delay to 2029 and reject new liability rules for banks. Additionally, banks should be allowed to charge fees for tax refund services.
This would lower administrative burdens and shield banks from legal liability.
Member States risk losing revenue due to inconsistent definitions of beneficial ownership.

Consultation response

European Federation of Investors and Financial Services Users, 18 Sept 2023

For BETTER FINANCE, the ECs FASTER Proposal can bring procedural progress in addressing longstanding obstacles to tax recovery for investors dealing with their cross-border investment income. We welcome an EU-wide framework to streamline withholding tax refund modalities. However, it remains key to…

Accountancy Europe calls for harmonised liability in tax relief

Accountancy Europe, 9 Aug 2023

The group wants relief at source to be the mandatory default system across Europe. They request that financial intermediaries be protected from liability for incorrect data provided by clients.
Standardised rules would reduce legal risks and administrative costs for financial professionals.
National tax authorities lose the flexibility to maintain their own fragmented refund systems.

Consultation response

KPMG, 26 Oct 2021

KPMG member firms in the EU are pleased to provide our comments in the attached document on the European Commission’s Roadmap consultation “Withholding taxes – new EU system to avoid double taxation”.

Consultation response

The Alternative Investment Management Association Limited, 26 Oct 2021

The attached response is made on behalf of the Alternative Investment Management Association and the Alternative Credit Council.

Luxembourg bankers demand optional status for EU tax relief

Association des Banques et Banquiers, Luxembourg, 18 Sept 2023

The ABBL calls for making the new tax relief procedures optional for financial intermediaries. They request more proportionality in reporting requirements and a delayed implementation until July 2028.
This would prevent compliance costs and legal liabilities from outweighing the policy's benefits.
Smaller financial institutions may face barriers to entry for providing securities services.

Aviva warns EU tax rules could disadvantage pension funds

Aviva Plc, 18 Sept 2023

Aviva requests the EU define tax residency proof, ideally including a list of third countries. Excluding funds from relief will add significant costs and impact customers directly. They also suggest data be submitted to a central portal to ensure standardisation.
Standardized digital procedures would help the company avoid time-consuming and expensive tax reclaim processes.
Customers and pension holders face lower returns due to higher costs and delayed tax reclaims.

ALFI Urges Clearer Tax Rules for Investment Funds

Association Luxembourgeoise des Fonds d'Investissement, 18 Sept 2023

ALFI requests a common EU approach recognizing investment funds as beneficial owners. They suggest extending reporting deadlines to reduce high volumes of reporting. The association seeks a 24-month implementation period following the directive's adoption.
Standardized rules would provide legal certainty and reduce costs for investment funds.
Tax authorities lose oversight power if financial intermediaries' legal liabilities are significantly limited.

Dutch pension funds urge inclusion of transparent investment funds in FASTER

Pensioenfederatie (Federation of the Dutch Pension Funds), 15 Sept 2023

The organization calls for including transparent investment funds to prevent significant investment losses. They also request limiting Member State exemptions so pension funds benefit from faster refunds.
Faster tax relief allows pension funds to reinvest capital quickly, generating millions in returns.
National tax authorities lose the power to exclude institutional investors from streamlined procedures.

Investment Association urges EU to simplify cross-border tax relief

The Investment Association, 18 Sept 2023

The group recommends removing exclusions for pension funds and shortening refund processing times. They also seek recognition for non-EU tax residency documents.
Faster relief would improve liquidity and reduce the financial burden of managing international investments.
Pensioners and individual savers could suffer from reduced investment returns and higher costs.

BNY Mellon urges unified EU withholding tax process

The Bank of New York Mellon, 18 Sept 2023

BNY Mellon requests a common pan-European operational process for withholding tax on securities. They warn that national specificities could undermine the proposal's goal of simplicity. They also seek better integration with existing trading and custody workflows.
Streamlined processes would improve the attractiveness of European capital markets for global clients.
Investors face higher costs if national specificities create a fragmented and complex market.

Consultation response

The Bank of New York Mellon, 26 Oct 2021

BNY Mellon supports the implementation of a standardized EU-wide system for withholding tax relief at source. We believe that that this is a necessary feature of a European Capital Markets Union. Accordingly, we support Policy Option 2. However, Policy Option 2 should be complemented by Policy…

PensionsEurope Urges Simplified Tax Relief for Pension Funds

PensionsEurope, 18 Sept 2023

PensionsEurope requests that transparent investment entities have access to these new tax procedures. They propose shifting legal liability for reporting information from financial intermediaries directly to investors. They also call for a harmonized definition of beneficial ownership to ensure legal certainty.
Standardized procedures would lower administrative costs and allow funds to reinvest tax savings.
Smaller pension funds lose access if intermediaries refuse service due to liability risks.

Consultation response

PensionsEurope, 25 Oct 2021

We welcomes the EC’s roadmap on the new EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes (WHT). We support the current EC´s mandate call for removing all barriers to the completion of the CMU – particularly in the field of simplifying…

Consultation response

Temasek International Pte Ltd, 25 Oct 2021

Temasek International Pte Ltd is grateful for this opportunity to respond to the three policy options outlined in the Commission’s Inception Impact Assessment. We provide our views in the attached letter and are happy to respond to any questions the Commission may have.

Polish Bank Association urges delay and simplification of tax reform

Związek Banków Polskich, 14 Sept 2023

The association requests a simplified system relying on formal documentation instead of complex due diligence. They advocate for removing reporting thresholds and delaying implementation until 2028 for system readiness.
Simplified requirements would reduce administrative costs and prevent the need for manual contract analysis.
Cross-border investors lose out on faster tax refunds due to the proposed implementation delay.

Swedish Securities Markets Association urges single EU tax portal

Swedish Securities Markets Association (Swedish: Föreningen Svensk Värdepappersmarknad), 18 Sept 2023

The association advocates for a single EU-wide portal for registration and reporting to avoid complex national systems. They suggest extending the scope to all securities issued by central depositories to reduce management complexity. They also request a 24-month delay following the adoption of laws to allow for technical development.
A centralized system would lower operational costs and reduce the risk of reporting errors.
Investors may face worse conditions if countries restrict tax relief based on ex-dividend dates.

Real estate association urges equal tax treatment for REITs

European Public Real Estate Association, 18 Sept 2023

The association requests specific provisions ensuring Real Estate Investment Trusts benefit from the new tax procedures. They advocate for relief at source to be the mandatory default system. Finally, they suggest limiting fees charged by financial intermediaries.
These changes would ensure their members avoid double taxation and high administrative costs.
Financial intermediaries might lose revenue if the EU limits their service fees.

German banking industry criticizes EU withholding tax relief proposal

Die Deutsche Kreditwirtschaft, 18 Sept 2023

The group opposes mandatory registration for all large banks and demands protection from liability for errors made by clients. They also call for a longer implementation period and the right to charge for refund services.
These changes would protect banks from high compliance costs and legal liability for client errors.
National governments may lose tax revenue if standardized definitions are not strictly applied across borders.

Paris Europlace slams complex EU tax relief proposal

Paris Europlace, 18 Sept 2023

The organization requests focusing on digital residence certificates and reducing financial intermediaries' liabilities. The proposal should also include non-intermediated flows and common investment funds.
Avoiding new procedures would save financial institutions from huge IT investments.
European companies lose appeal if complex procedures deter international investors.

French financial markets group AMAFI criticizes complex tax directive

Association Française des Marchés Financiers, 15 Sept 2023

AMAFI demands the inclusion of unlisted securities and the reduction of burdensome reporting requirements. They argue the current proposal's complexity would actually discourage cross-border investments and harm market efficiency.
Intermediaries would avoid expensive technical updates and excessive legal liability for negligence.
Investors and companies face higher costs and more complex capital raising.

German tax advisors urge simpler EU withholding tax relief

Deutscher Steuerberaterverband e.V., 15 Sept 2023

The DStV requests that relief at source becomes the standard to minimize costs for small investors. They also propose direct access to systems to ensure late refund interest reaches investors.
Tax advisors would benefit from reduced bureaucracy and improved legal certainty for their international clients.
Financial intermediaries face revenue losses from the proposed reduction of their role in tax procedures.

AEIP Urges EU to Streamline Tax Relief for Pension Funds

European Association of Paritarian Institutions of Social Protection, 18 Sept 2023

AEIP requests that collective investment funds be allowed to use the new digital procedures. They also want liability for reporting errors shifted from financial intermediaries to the investors. Finally, they argue that Member States should not exclude tax-exempt pension funds from the rules.
Pension funds would gain millions in annual returns by reinvesting tax refunds much faster.
Individual investors would face direct liability and financial recovery actions for reporting errors.

Consultation response

ABP Pensionfund, 18 Sept 2023

Please find attached the contribution of Stichting Pensioenfonds ABP on the Proposal for a Directive on Faster and Safer Relief of Excess Withholding Taxes (FASTER).

European tax advisers urge mandatory relief at source system

European Tax Adviser Federation, 18 Sept 2023

The federation advocates for a mandatory relief at source system and expanding the rules to cover all payments subject to withholding taxes.
This would lower administrative burdens and compliance costs for tax professionals and investors.
Investors face potential financial harm if intermediaries charge high fees for fast-track services.

Consultation response

European Tax Adviser Federation, 26 Oct 2021

The European Tax Adviser Federation (ETAF) welcomes the European Commission’s intention to present, by the end of 2022, a proposal to establish a European withholding tax framework on dividend or interest payments. In principle, ETAF acknowledges that withholding taxes as such can reduce the risk…

German tax advisers urge unified EU-wide withholding tax relief

Bundessteuerberaterkammer, 18 Sept 2023

The organization calls for a single unified procedure covering dividends, interest, and royalties. They urge the Commission to mandate a fully automated system for digital residency certificates to avoid fragmented national approaches.
Unified procedures would remove competitive disadvantages and lower administrative costs for businesses.
Financial intermediaries would lose revenue if the EU limits their service fees.

Consultation response

Association Nationale des Sociétés par Actions, 14 Sept 2023

Partie intéressée : ASSOCIATION NATIONALE DES SOCIETES PAR ACTIONS (ANSA) 39 Rue de Prony 75017 PARIS FRANCE Numéro didentification du registre de transparence de lUnion Européenne : 236569017571-35 LAssociation Nationale des Sociétés par Actions (ANSA) sest réjouie de constater que la consultation…

Consultation response

Kammer der Steuerberater:innen und Wirtschaftsprüfer:innen, 21 Oct 2021

Die Bemühungen der Kommission zur Schaffung eines gemeinsamen Systems zur Vermeidung von Quellensteuern ist sehr zu begrüßen. Die Hürden und der Aufwand, den Investoren aktuell auf sich nehmen müssen, um eine abkommenskonforme Quellenbesteuerung ihrer Investments zu erreichen, sind – ganz besonders…

Consultation response

Association of Global Custodians, 26 Oct 2021

The Association of Global Custodians welcomes the Commission's initiative to improve withholding tax procedures within the EU. As detailed in the attached letter, we believe a well-functioning relief at source system must be the primary solution (based on standardized documentation, investor…