Main results from the High-Level Working Party on Tax Questions meeting on 27 January
The High-Level Working Party (HLWP) on Tax Questions within the Council met on 27 January 2026. The agenda included several international tax matters. Member States’ experts exchanged views on United Nations negotiations for a Framework Convention on international tax cooperation, next steps on the Global Minimum Tax, and received an update from the Cyprus Presidency on the OECD Inclusive Framework on BEPS. On domestic issues, the Presidency outlined its taxation priorities, while the Commission presented taxation aspects of the Savings and Investments Union Strategy’s pension package and information on tax simplification. Experts also discussed the Commission’s evaluation of Directive 2011/16/EU on administrative cooperation, received an update on negotiations with Norway on direct tax cooperation, and exchanged views on the Commission’s report “Mind the Gap on tax compliance and tax expenditure in the EU”.
FISC hearing examines limits to EU tax harmonisation
On 27 January 2026, FISC MEPs held a public hearing on tax obstacles in the single market, followed by the presentation of the EPRS study “The Cost of non-Europe: the future of EU tax policy harmonisation”. Commission Director for Direct Taxation Benjamin Angel said the optional “28th regime”, due on 18 March 2026, will focus on company law with tax aspects limited to the deferral of taxation on employee stock options. He noted that unanimity and lack of trust among Member States still hinder progress, while digital tax talks are set to resume at OECD level with renewed US participation. Christos Theophilou (STI Taxand) identified administrative fragmentation and double taxation as major obstacles, urging proportionality for SMEs and stronger dispute prevention. Johanna Hey (University of Cologne) warned that implementing OECD Pillar Two without amending the EU Directive risks legal uncertainty, while Rita de la Feria (University of Leeds) cautioned that uncoordinated national measures could create new barriers. The EPRS study presentation outlined that fragmented tax systems drive high compliance and economic costs and targeted EU coordination could reduce these without full harmonisation.
European Commission highlights Fiscalis programme’s role in combatting tax fraud
On 23 January, the European Commission published its interim evaluation of the Fiscalis programme for 2021–2027, assessing its contribution to tax cooperation and the fight against tax fraud, evasion and aggressive tax planning in the EU. The report describes Fiscalis as supporting the development, maintenance and operation of European electronic systems and administrative cooperation tools, with a total budget of €269 million. It notes that over 80% of programme expenditure has been allocated to EU-wide IT systems, including the Transaction Network Analysis tool used within Eurofisc, as well as systems underpinning the Directive on Administrative Cooperation, such as the DAC6 central directory. According to the evaluation, these systems support automated data exchange and analysis, while the accompanying staff working document observes that the preventive impact of certain instruments remains difficult to quantify.
European Commission’s January tax infringement decisions
On 30 January 2026, the European Commission launched several tax infringement actions, notably sending letters of formal notice to twelve Member States, Belgium, Bulgaria, Czechia, Estonia, Greece, Spain, Cyprus, Luxembourg, Malta, the Netherlands, Poland and Portugal, for failing to fully transpose Directive (EU) 2023/2226 on administrative cooperation in the field of taxation, which extends tax transparency and information exchange obligations to crypto-assets. The Commission also sent letters of formal notice to ten Member States, Belgium, Bulgaria, Czechia, Greece, Cyprus, Malta, the Netherlands, Portugal, Romania and Sweden, for failing to fully transpose Directive (EU) 2025/872, which further strengthens information exchange rules on administrative cooperation in taxation. The Member States concerned now have two months to address the shortcomings before the procedures may be escalated to reasoned opinions.
Excise duties: General Court of the European Union rules on electricity network levy
In its judgment of 28 January 2026 in Case T‑653/24 (Accorinvest and Société Générale), the General Court of the EU interpreted Article 1(2) of Directive 2008/118 on excise duties. The case stemmed from proceedings before the French Conseil d’État on a tariff-based contribution for electricity transmission and distribution services passed to consumers. The Court held that a legal mechanism allowing a tax to be passed on does not in itself create a direct link with electricity consumption and that a levy based only on fixed network access charges, independent of actual use, is not an ‘other indirect tax’ on excise goods under EU law.
Joint ECON/FISC exchange of views with Commissioner Hoekstra on 9 February
On 9 February 2026, the European Parliament’s Subcommittee on Tax Matters (FISC) and the ECON Committee will hold a joint exchange of views with Commissioner Wopke Hoekstra. According to the agenda, the discussion will focus on the European Commission Work Programme 2026, including planned tax initiatives and possible withdrawals or revisions of existing proposals. The exchange will allow MEPs to assess the Commission’s tax priorities for the year ahead in the context of ongoing parliamentary scrutiny of the Work Programme. It has been reported that Commissioner Hoekstra has replied to MEPs’ concerns about the withdrawal of a number of tax initiatives, including the Financial Transaction Tax (FTT), citing the proposals’ long-standing nature and the absence of legislative progress.
Multi-stakeholder dialogue held ahead of UN tax sessions
An online multi-stakeholder dialogue held on 29 January 2026 discussed three intersessional papers released ahead of the fourth session of the Intergovernmental Negotiating Committee on the UN Framework Convention on International Tax Cooperation, including a draft framework convention template from the Workstream I co-leads, a Workstream II draft options paper on taxing cross-border services, and a Workstream III concept note on tax dispute prevention and resolution. Participants raised questions on process transparency, including concerns about limited visibility of draft texts and informal meetings, as well as on sequencing between the framework convention and future protocols. Secretariat and workstream co-leads reiterated that all decisions remain member state-driven and confirmed that the February session will mark the transition from scoping to drafting, with protocols intended to operate coherently under the framework convention rather than as standalone instruments. Discussions also touched on capacity constraints, access to transfer pricing information, and proposals to explore technical solutions, including the possible establishment of a dedicated task force. On the same day, EU member states addressed the UN tax negotiations in the Council Working Party on Tax Questions, in preparation for the negotiating session in New York scheduled for 2–13 February 2026.
Multi-stakeholder dialogue held ahead of UN tax sessions
An online multi-stakeholder dialogue held on 29 January 2026 discussed three intersessional papers released ahead of the fourth session of the Intergovernmental Negotiating Committee on the UN Framework Convention on International Tax Cooperation, including a draft framework convention template from the Workstream I co-leads, a Workstream II draft options paper on taxing cross-border services, and a Workstream III concept note on tax dispute prevention and resolution. Participants raised questions on process transparency, including concerns about limited visibility of draft texts and informal meetings, as well as on sequencing between the framework convention and future protocols. Secretariat and workstream co-leads reiterated that all decisions remain member state-driven and confirmed that the February session will mark the transition from scoping to drafting, with protocols intended to operate coherently under the framework convention rather than as standalone instruments. Discussions also touched on capacity constraints, access to transfer pricing information, and proposals to explore technical solutions, including the possible establishment of a dedicated task force. On the same day, EU member states addressed the UN tax negotiations in the Council Working Party on Tax Questions, in preparation for the negotiating session in New York scheduled for 2–13 February 2026.
INTA committee examines European Commission proposal to extend CBAM to downstream goods
On 26 January, the European Commission presented its proposal to amend the Carbon Border Adjustment Mechanism (CBAM) to certain downstream goods and strengthening anti-circumvention measures to the European Parliament’s Committee on International Trade (INTA). The proposal would add around 180 mainly industrial downstream products and address circumvention risks, including the scrap loophole. Members raised questions on timelines, supply chain impacts, ETS alignment and trade effects. The European Commission stated that the downstream provisions would apply from 1 January 2028 if an agreement is reached by end-2026. According to its provisional agenda, the Council’s ad hoc working party on CBAM will examine the proposal and impact assessment on 5 February.
OECD VAT Forum addresses compliance, fraud and digitalisation challenges
The OECD Global Forum on VAT held its sixth meeting in Paris on 26–28 January, bringing together more than 300 participants from 104 jurisdictions, international organisations and businesses to discuss future-ready VAT systems amid digital transformation. Discussions stressed the importance of global co-ordination to support trade and investment while protecting tax revenues and marked the tenth anniversary of the International VAT/GST Guidelines. Participants examined compliance and fraud risks linked to digital trade, including the use of Digital Continuous Transactional Reporting and enhanced administrative co-operation through the new SCAN-VAT platform. Emerging issues raised included crypto-assets, artificial intelligence and their implications for VAT policy and administration.
AMLA to test risk models and prepare further consultations
The EU Anti-Money Laundering Authority (AMLA) has announced that it will launch a data collection exercise to test risk assessment models used in the financial sector, according to a press release. AMLA also reportedly indicated that it will publish further public consultations in the coming weeks, including a second consultation on draft regulatory technical standards on customer due diligence, following an initial consultation conducted by the European Banking Authority in 2025. In addition, AMLA plans to launch a public consultation on draft regulatory technical standards setting thresholds and criteria to identify business relationships under Article 19(9) of the Anti-Money Laundering Regulation.
