OECD reaffirms global commitment to Pillar Two tax reform
At the 17th Plenary of the OECD/G20 Inclusive Framework on BEPS, held in Cape Town from 7 – 10 April 2025, delegates from 135 countries and 11 international organisations reaffirmed their commitment to the Pillar Two Solution to address tax challenges from the digitalisation of the economy, despite the US withdrawal and increasing trade tensions. In a public statement by the Inclusive Framework, agreed at the meeting, members recognised the importance of securing certainty and stability in the international tax system, and the need to continue discussions on the Two-Pillar Solution and other items for a future agenda using a phased, evidence-based approach. Delegates discussed the progress of BEPS measures, strategies for domestic resource mobilisation, and the inclusion of developing country perspectives, especially on capacity building. The Inclusive Framework also committed to exploring new tax-related issues such as global mobility and the interplay between tax policy, inequality, and growth.
European Commission seeks input on tax barriers to the integration of EU capital markets
As part of its Savings and Investments Union (SIU) strategy, the European Commission launched on Tuesday 15 April a targeted consultation to gather feedback on obstacles to capital markets integration across the EU, including tax barriers. The SIU strategy aims to boost the EU economy's competitiveness by improving the way the EU financial system mobilises savings towards productive investments, offering more and better financial opportunities for both citizens and businesses. This consultation, which takes the form of a questionnaire, invites financial markets participants and national authorities to provide their views, facts, and evidence on barriers to cross‑border trading and post‑trading, scaling up investment funds, and harmonising supervisory practices, as well as on simplification. Tax barriers such as inefficient withholding tax collection procedures and non-harmonised procedures to collect transaction taxes are notably mentioned as possible obstacles to be assessed by stakeholders. The online questionnaire, through which the responses should be submitted, will be available as of 22 April 2025 and will remain open until 10 June 2025. A PDF version is already available here. The insights collected will help shape measures to be presented in a comprehensive package in the fourth quarter of 2025.
Busy agenda for the next High-Level Working Party on Tax Questions on 29 April
The next Council High-Level Working Party (HLWP) on Tax Questions is scheduled to convene on Tuesday 29 April, with several international tax issues on the agenda. Member States experts will indeed hold an exchange of views on the United Nations negotiations on a Framework Convention on international tax cooperation and on the way forward for the Global Minimum Tax. They will also receive information from the Polish Presidency of the Council on the OECD/G20 Inclusive Framework on BEPS. On domestic tax topics, a presentation by the Presidency and an exchange of views are scheduled on a “structured approach for tax decluttering and simplification”. Furthermore, tax experts will prepare a general approach on the Directive on VAT rules for distance sales of imported goods and import VAT, to be possibly adopted at the May ECOFIN Council, as well as exchange views on the way forward on the Directive on Transfer Pricing. The full agenda can be consulted here.
DAC9 and Stop the Clock proposal formally adopted
Following previous agreements, the Council of the EU formally adopted on Monday 14 April two important pieces of EU legislation for the tax profession: - a directive (DAC9) that will extend cooperation and information exchange in the area of minimum effective corporate taxation; and – the so-called “Stop the Clock” proposal to delay the application of upcoming sustainability reporting and due diligence requirements. DAC9 simplifies reporting for large corporations by enabling central filing for a top-up tax information return (TTIR) and introduces a standard form across the EU. It also extends the framework for automatic exchange between member states to cover TTIR. The “Stop the clock” proposal postpones to 2028 the Corporate Sustainability Reporting Directive (CSRD) requirements for large companies that have not yet started reporting, as well as listed SMEs. It also postpones to 2028 the application of the Corporate Sustainability Due Diligence Directive (CSDDD) for the first set of companies concerned.
39 MEPs ask the Commission to clarify its stance on the taxation of big digital tech companies
A group of 39 MEPs mostly from S&D, Greens/EFA, the Left and, in a lesser extent, from EPP and Renew Europe, has submitted a written question to the European Commission on the issue of taxing big digital technology companies. The EU had initially agreed to introduce a digital levy as a new own resource. However, this initiative was paused to give room for a multilateral solution negotiated under the G20 and OECD Two-Pillar solution. Recent US developments now threaten the implementation of Pillar Two and cast doubt on a successful outcome for Pillar One, MEPs stress, recalling previous Commission’s commitments to act independently if no global agreement is reached internationally. The MEPs are now pressing the Commission to clarify whether it is ready to propose an EU-wide digital services tax. This question gains urgency in light of new protectionist measures from the United States, including so-called "Liberation Day" tariffs, and ongoing debates among EU leaders about establishing sustainable new EU own resources, MEP say.
New EU Tax Observatory study on the role of tax base reforms in declining corporate tax rates
A new working paper from the EU Tax Observatory published on Tuesday 15 April reveals that between 2014 and 2022, multinational corporations in the EU benefited from a steady decline in their effective tax rates, primarily due to tax base-narrowing reforms rather than reductions in statutory tax rates. Analysing over 40 000 affiliate-level financial accounts and a newly constructed dataset of 295 corporate tax reforms across EU Member States, the study shows a shift away from the traditional "cut rate – broaden base" approach. Instead, countries increasingly used targeted tax incentives to promote industrial policy objectives. These base-narrowing reforms alone accounted for 24% of the effective tax rate decline, contributing to an estimated 16 billion € in lost tax revenue, which amounts to 3.5% of total tax revenue collected from the sample firms over the period, according to the study. As governments align their tax policies with industrial policy objectives, they should carefully evaluate the potential benefits relative to the associated costs, researchers warn. Monitoring tax base reforms and backward-looking effective tax rates — alongside statutory and model-based effective tax rates — can enhance transparency regarding the costs and distributional implications of uncoordinated tax policymaking in the EU. More openness towards corporate tax harmonization beyond the implementation of anti-avoidance measures might be needed to counteract further base erosion, they concluded.
EU Sanctions Helpdesk to host introductory online event on 29 April
The EU Sanctions Helpdesk, launched in March 2025, will host its first introductory online event on Tuesday 29 April from 11:00 to 12:30. The session aims to inform businesses — particularly SMEs —about the Helpdesk’s role in supporting sanctions compliance. The agenda features a keynote address, “Navigating sanctions: the future for SMEs and the role of the Helpdesk,” highlighting the impact of sanctions on small and medium-sized enterprises and the importance of stakeholder collaboration. An overview presentation will also introduce the Helpdesk’s mission and services, while an interactive Q&A session will offer attendees the opportunity to engage directly with EU Commission representatives and the Helpdesk team. This event is designed to empower SMEs with practical tools and compliance strategies to navigate the evolving EU sanctions landscape. To attend, register here.
