Main tax outcomes of the ECOFIN meeting on 17 February 2026
During the ECOFIN Council meeting on 17 February 2026, EU Finance Ministers exchanged views on the supplementary pensions package. More specifically, the package amends the pan-European personal pension product (PEPP) regulation and the Institutions for Occupational Retirement Provision (IORP) Directive. During their discussion, Member States voiced general support for the Commission’s proposals to improve the EU’s supplementary pension framework, published on 20 November 2025. At the same time, several delegations stressed the need to respect Member State competences and requested clarifications on the proposed inclusion of a non-discriminatory tax treatment provision for PEPPs in national frameworks. Many Member States argued that taxation remains a national competence and that unanimity voting on tax matters should continue. The Commissioner for Financial Services and the Savings and Investments Union, Maria Luís Albuquerque, stated that the proposed addition to Article 3 of the PEPP regulation is a non-discrimination clause for “objectively comparable” PEPPs that does not amount to tax harmonisation, and that the legal basis was confirmed by the Council Legal Service. As a non-discussion item, the Council also decided to add Turks and Caicos Islands and Viet Nam to the EU list of non-cooperative jurisdictions for tax purposes (Annex I). Additionally, Fiji, Samoa, and Trinidad and Tobago were removed from the list as they now comply with all agreed international standards. Following this update, the list now consists of 10 jurisdictions: American Samoa, Anguilla, Guam, Palau, Panama, Russia, Turks and Caicos Islands, US Virgin Islands, Vanuatu, and Viet Nam. The Council also approved the usual state of play document (Annex II), which reflects ongoing cooperation with its international partners and the commitments of these countries to reform their legislation to adhere to agreed tax good governance standards. The Council removed Antigua and Barbuda and the Seychelles from this list, as they both received a positive rating from the OECD Global Forum regarding their tax legislation.
European Commission opens call for evidence on the taxation omnibus package
On 16 February 2026, the European Commission opened a call for evidence on the upcoming taxation omnibus package. In the field of direct taxation, the Council approved conclusions setting a tax decluttering and simplification agenda on 11 March 2025, with a view to contributing to the EU’s competitiveness. In this context, the taxation omnibus forms part of the Commission’s broader efforts to simplify EU law and reduce red tape for businesses in order to boost competitiveness. It aims to streamline, enhance and clarify the corporate tax directives, namely the Interest and Royalties Directive (IRD), the Tax Merger Directive (TMD), the Parent-Subsidiary Directive (PSD), the Anti-Tax Avoidance Directive (ATAD), and the Tax Dispute Resolution Mechanisms Directive (TDRMD). The initiative seeks to address potential revisions of certain ATAD provisions, including the overlap between the Controlled Foreign Company rules and Pillar 2 rules, the Interest Limitation Rule and the General Anti-Abuse Rule. The current framework is also considered not to sufficiently encourage cross-border economic activity and to undermine the effectiveness of the corporate tax directives due to differences in their material scope, as well as procedural requirements to access certain tax benefits that vary substantially between Member States. In addition, the TDRMD contains interpretative uncertainties that appear to discourage stakeholders from making use of the Directive in practice. As outlined in the Commission Work Programme 2026, a legislative proposal is expected in the second quarter of the year. The deadline for stakeholders to provide feedback is 16 March 2026.
OECD publishes Amount B pricing FAQs and the 2026 version of the Pricing Automation Tool
On 17 February 2026, the OECD published FAQs to ensure consistent application of its approach to Amount B, as reflected in its consolidated report published on 24 February 2025. Amount B introduces a simplified and streamlined approach for applying the arm’s length principle to in-country baseline marketing and distribution activities and is part of the Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy. The FAQs clarify that no re-computation of the accounts payable guardrail or the +/- 0.5% pricing matrix range is required following adjustments, that the guardrail is calculated annually, and that only items linked to qualifying transactions are included in working capital. They further clarify that start-ups should rely on the limited available prior-year data (or current-year data where none exists), that the specific definition of net revenue for commissionaires and sales agents applies equally to the return on sales calculation, and that the “mixed products” category is to be used only where multiple products span industry groupings and cannot be reliably assessed separately. Additionally, the OECD has released the 2026 version of its Pricing Automation Tool, which automatically calculates the Amount B return for in-scope tested parties based on limited data inputs. The updated version incorporates the latest pricing matrix and relevant datapoints, ensuring that the results align with the current year’s parameters. The tool is intended to streamline compliance and enhance administrative efficiency for both tax administrations and taxpayers, and will continue to be updated annually to reflect future adjustments.
International Tax Observatory signs Memorandum of Understanding with Spain’s Ministry of Finance
On 20 February 2026, the International Tax Observatory announced the signature of a Memorandum of Understanding with the Spanish Ministerio de Hacienda. The agreement was signed by Jesús Gascón Catalán on behalf of the Ministry and by Gabriel Zucman, Director of the International Tax Observatory. According to the announcement, the partnership aims to strengthen cooperation on research and policy dialogue to improve tax systems. Areas of collaboration are expected to include work on tax progressivity in Spain, the development of joint research projects, the organisation of expert seminars, and the exchange of knowledge between researchers and public officials. The parties indicated that the initiative aims to support evidence-based tax policy by fostering closer institutional cooperation.
Working Party on Tax Questions to meet on 25 February 2026
The Council’s Working Party on Tax Questions (Indirect Taxation - Excise Duties/Energy Taxation) is scheduled to meet on 25 February 2026. Based on the provisional agenda, a revised Cyprus Presidency compromise text on the proposal for a recast Council Directive on the structure and rates of excise duty applied to tobacco and related products will be discussed. The revision follows the European Commission’s proposal of 16 July 2025 to update Directive 2011/64/EU, including provisions on cigarettes and novel products such as e-cigarettes, heated tobacco, and nicotine pouches. Ahead of the meeting, it has been reported that a new compromise draft dated 18 February proposes a minimum rate of €0.30 per millilitre of e-liquid for e-cigarettes, compared to €0.20 in the previous text, as several Member States considered the earlier rate too low and broadly aligned with existing national levels. The revised draft reportedly also proposes a lower minimum rate of €107 per kilogram for nicotine pouches, compared to €143 in the previous compromise, following comments from Member States that the earlier level exceeded most national rates. The draft agenda foresees political agreement at the ECOFIN Council meeting on 12 June 2026 on the recast Directive.
ECON draft report proposes safeguards for EPPO and OLAF access to EU VAT information
On 20 February 2026, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) published its Draft Report on the proposal to amend Regulation (EU) No 904/2010 to grant the European Public Prosecutor’s Office (EPPO) and the European Anti-Fraud Office (OLAF) access to value added tax information at Union level, under the consultation procedure (CNS). The report, led by Rapporteur Michalis Hadjipantela (EPP, CY), supports the Commission’s objective of establishing direct, streamlined communication channels between Eurofisc and both bodies, and granting them specific, centralised access to relevant VAT data within their respective mandates. The proposed amendments focus on data protection safeguards, clarifying that access should be limited to strictly necessary data categories and linked to concrete investigations or prosecutions, while preventing untargeted searches and requiring that each access be attributable to an identified authorised user, thereby allowing effective ex post verification. The draft also highlights the need for adequate financial resources to ensure secure and effective access to VAT information. An indicative plenary sitting is scheduled for 7 July 2026.
