Taxation and Customs Union

Package for fair and simple taxation

It is more important than ever for Member States to have secure tax revenues, so they can invest in the people and businesses who need it most.

To achieve this, fair, efficient and sustainable taxation is key. That is why on 15 July 2020, the European Commission adopted a new Tax Package. The Package reinforces the fight against tax abuse, helps tax administrations keep pace with a constantly evolving economy and eases administrative burdens for citizens and companies. It also ensures improved cooperation with non-EU countries, and strengthens the Commission’s support to developing countries.

 

Tax Package : Securing prosperity through fair taxation infography

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The Tax Package contains three separate but complementary initiatives. They set out the path towards fairer, simpler and modernised tax systems. 

Action Plan for fair and simple taxation supporting the recovery

The Tax Action Plan is a set of 25 initiatives the European Commission will implement between now and 2024 to make taxation fairer, simpler and more adapted to modern technologies. The Tax Action Plan sets out measures to:

  • Reduce tax obstacles and unnecessary administrative burdens for businesses in the Single Market. Tax simplification will improve the business environment, enhance business competitiveness and contribute to economic growth. 
  • Help Member States enforce existing tax rules and improve tax compliance, ensuring they can secure reliable tax revenues. 
  • Help tax authorities better exploit existing data and share new data more efficiently, in a way which will improve the enforcement of tax rules and help combat tax fraud and evasion more effectively. 
  • Promote taxpayers’ rights, by increasing their awareness of their rights under EU law, simplifying their obligations and facilitating their compliance. 

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Infography about the new taxation package 2020. Tax Action Plan for Fair and Simple Taxation Supporting the EU’s recovery

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Revision of the Directive on administrative cooperation (DAC7)

The Commission has proposed to amend the Directive on Administrative Cooperation, to extend the EU tax transparency rules to digital platforms. Member States will automatically exchange information on income generated by sellers on digital platforms. This will not only allow national authorities to identify situations where tax should be paid, but will also reduce the administrative burden placed on platforms, who have to deal with several, different national reporting requirements. 

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Communication on Tax Good Governance in the EU and beyond

The Communication on Tax Good Governance aims to further strengthen how the EU can promote transparency and fair taxation. This includes a reform of the Code of Conduct and improvements to the EU list of non-cooperative jurisdictions. The Communication also outlines the EU’s approach to assisting developing countries in the area of taxation, in line with the 2030 Sustainable Development agenda.

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