EU Seeks to Simplify Corporate Taxes and Lower Withholding Tax

A Reason to Celebrate? EU Commission Seeks to Simplify Tax Rules for Companies

2026-06-25 Source: dpa 1 min Reading Time

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To strengthen Europe's competitiveness and facilitate investment in the single market, the European Commission plans to simplify corporate taxation, according to dpa ...

EU Economic Affairs Commissioner Valdis Dombrovskis, speaking in the context of a reform of corporate tax rules, promises: “Our proposals for tax simplification include changes that will make life easier for businesses.” Read more here ...(Image: EU) — EU Economic Affairs Commissioner Valdis Dombrovskis, speaking in the context of a reform of corporate tax rules, promises: “Our proposals for tax simplification include changes that will make life easier for businesses.” Read more here ...
(Image: EU)

In recent years, the EU has further developed its regulations on direct taxes in response to certain challenges, such as globalization and digitalization. However, this has made the regulatory framework more complex and increased the administrative burden on companies operating across borders, the Brussels authorities explained in outlining their plans for simplification. According to their calculations, the simplification measures are expected to save companies in the EU approximately $9 billion annually—of which about $4 billion will come from the reduction of administrative costs alone.

No More Withholding Tax, Easier Refunds, And Fewer Reporting Requirements

EU Economic Affairs Commissioner Valdis Dombrovskis promises: “Our proposals for tax simplification include changes that will significantly improve transparency and legal certainty for both businesses and tax administrations.” For example, the Commission proposes exempting those affected from withholding tax on various cross-border payments between companies. Among other things, refunds are to be processed more easily to promote financing and investment. And for certain multinational companies, some reporting requirements are to be eliminated or reduced. In addition, tax authorities will be able to identify taxpayers more efficiently and reliably, as the report also notes. The proposals will now be submitted to EU member states and the European Parliament.

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