Taxation and customs union

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Repeal of the Savings Directive in line with international and EU developments

Directive 2003/48/EC, which since 2005 had allowed tax administrations better access to information on private savers, was repealed by the Council on 10 November 2015.

  • Repeal of the Directive follows a strengthening of measures to prevent tax evasion. A significant overlap had developed with other legislation adopted at the end of 2014 in this field and, in line with international developments, the repeal eliminates that overlap.
  • Directive 2003/48/EC requires the automatic exchange of information between Member States on private savings income. This enables interest payments made in one Member State to residents of other Member States to be taxed in accordance with the laws of the state of residence. The Directive was last amended in March 2014 to reflect changes to savings products and developments in investor behaviour since it came into force in 2005. However, the repeal means that the March 2014 amendments will no longer have to be transposed by Member States.
  • The repeal was adopted as a consequence of the adoption by the Council in December 2014 of Directive 2014/107/EU amending provisions on the mandatory automatic exchange of information between tax administrations. Directive 2014/107/EU implements the July 2014 OECD Global Standard on automatic exchange of financial account information within the EU, with a scope covering not only interest income, but also dividends and other types of capital income, and the annual balance of the accounts producing such items of income. Directive 2014/107/EU entered into force on 1 January 2016.
  • Directive 2014/107/EU is generally broader in scope than Directive 2003/48/EC. It provides that in cases of overlap of scope, Directive 2014/107/EU is to prevail.

The EU has negotiated similar agreements incorporating the OECD Global Standard on automatic exchange of financial account information with a number of third European Countries.

Transitional measures

The repeal was enacted by a Directive adopted by the Council, which also provides for transitional measures. In particular Austria benefits of a derogation under Directive 2014/107/EU, which permits Austria to delay the application of Directive 2014/107/EU by one year until 1 January 2017.  However, on the adoption of Directive 2014/107/EU, Austria announced that it would not make full use of the derogation. Instead, Austria is to exchange information by September 2017, albeit on a limited set of accounts, while retaining the derogation in other cases. Therefore, specific provision were included in the Savings Repeal Directive to ensure that Austria, and the paying agents and economic operators established therein, continue to apply the provisions of Directive 2003/48/EC during the period of derogation, except for those accounts to which Directive 2014/107/EU applies.