European Commission publishes 2026 work programme for VAT in the Digital Age implementation
On 22 May 2026, the European Commission published its 2026 work programme for the implementation of the VAT in the Digital Age (ViDA) package, outlining the legislative, technical and administrative measures planned for the coming year. Among the key actions are the adoption of implementing rules for the new Digital Reporting Requirements (DRR), further development of the central VAT Information Exchange System (central VIES), publication of the updated EU standard for e-invoicing, and continued work on securing the Import One Stop Shop (IOSS) framework. The programme also foresees extensive consultations with Member States and businesses, the preparation of explanatory notes on the new rules, and ongoing technical support for national administrations. The Commission noted that 12 Member States have already requested assistance through the Technical Support Instrument to prepare for the introduction of e-invoicing and digital reporting systems. The work programme complements the Commission’s ViDA Implementation Strategy published in September 2025 and sets out the activities planned for 2026 and the first half of 2027 in preparation for the phased implementation of the ViDA package. The first measures will apply from 1 January 2027, while further reforms relating to platform economy operators and Single VAT Registration will take effect from 1 July 2028, followed by the introduction of mandatory cross-border digital reporting and e-invoicing from 1 July 2030.
EU Inc. debate highlights Member States’ concerns over safeguards and tax provisions
On 28 May 2026, at the Competitiveness Council meeting, ministers discussed the proposal for a Regulation establishing the “EU Inc.” 28th regime corporate legal framework, an optional and fully digital company law framework intended to facilitate cross-border business operations across the EU. While Member States broadly welcomed the objective of simplifying company creation and reducing administrative burdens, many emphasised the need for robust safeguards against fraud, tax evasion and money laundering. Several delegations also highlighted the importance of ensuring legal certainty in areas such as taxation, insolvency and the legal basis of the proposal. Furthermore, a number of Member States questioned the inclusion of Article 79 on the tax treatment of employee stock options in a non-tax legislative instrument, with some calling for further legal analysis of the proposal’s tax elements. Delegations also raised concerns regarding the potential for abusive structures, regulatory arbitrage and letterbox companies, while stressing the need to preserve effective anti-fraud and anti-money laundering safeguards.
Informal ECOFIN discusses competitiveness, digital finance and investment priorities
On 22 and 23 May 2026, EU finance ministers gathered for an informal ECOFIN meeting in Lefkosia to discuss competitiveness, digital finance and Europe’s future investment needs. The debate, based on an IMF paper from November 2025 and contributions from the IMF and the European Court of Auditors, focused on financing strategic priorities such as competitiveness, innovation and economic resilience without undermining sound public finances. Ministers broadly agreed that rising investment requirements would need to be accompanied by structural reforms and measures to mobilise private capital. European Commission Executive Vice-President Valdis Dombrovskis reportedly noted that the Commission’s forthcoming Spring Semester Package, due to be presented on 3 June 2026, would seek to balance fiscal discipline with future-oriented investment. During the meeting, ministers also exchanged views on stablecoins and digital finance developments in the context of the upcoming review of the Markets in Crypto-Assets Regulation (MiCA), while a Eurogroup meeting held on the margins addressed euro-area economic developments, housing affordability and the digital euro project.
European Commission opens foreign subsidies investigation into JD.com takeover over financing and tax incentives
On 28 May 2026, the European Commission announced that it has opened an in-depth investigation under the Foreign Subsidies Regulation (FSR) into JD.com’s proposed acquisition of the German retail group CECONOMY. The Commission’s preliminary assessment indicates that JD.com may have received foreign subsidies, including preferential financing, tax incentives and grants, that could distort competition in the EU internal market. The Commission will examine whether these measures enabled JD.com to offer more favourable conditions during the acquisition process and whether they could improve the competitive position of the merged entity after the transaction. The investigation will focus on whether the alleged subsidies distorted the acquisition process and whether they may have negative effects on competition and market conditions within the EU. The Commission has until 2 October 2026 to take a decision.
MEP delegation discusses Pillar Two and digital taxation during Brazil mission
From 26 to 28 May 2026, a delegation of Members of the European Parliament’s Subcommittee on Tax Matters (FISC) travelled to Brasília to discuss international tax cooperation and broader economic policy issues with Brazilian authorities. Following the visit, FISC Chair Pasquale Tridico (The Left, Italy) welcomed Brazil’s ongoing tax reform efforts, including the introduction of a 15% minimum tax rate for multinational enterprises. He also emphasised the importance of reducing compliance costs associated with the implementation of the OECD/G20 Pillar Two rules. The delegation further highlighted the need to continue efforts towards a global solution for the taxation of digital services, noting the current standstill in Pillar One negotiations. In addition, discussions covered digital payments and financial innovation, including Brazil’s Pix payment system, in the context of the European Union’s work on the digital euro.
OECD policy brief reviews impact of corporate tax policy on business growth
On 27 May 2026, the OECD published a policy brief examining how corporate income tax (CIT) systems can influence business dynamism, including firm entry, growth, innovation and market competition. The OECD notes that declining business dynamism has become a growing concern across advanced economies and argues that tax policy can play an important role in supporting entrepreneurship and investment. The brief highlights that high tax compliance costs and complex tax rules can create significant barriers for small and young businesses, while well-designed loss relief provisions and targeted tax incentives may help reduce financing constraints and encourage innovation. At the same time, the OECD warns that poorly designed incentives can distort competition, favour incumbent firms and discourage business growth. The brief also points to differences in effective tax rates between large and small firms, noting that larger businesses are often better positioned to benefit from tax planning opportunities and tax incentives. The OECD concludes that corporate tax systems should seek to reduce unnecessary complexity, support entrepreneurial risk-taking and limit competitive distortions, while remaining aligned with broader tax policy objectives.
OECD releases consolidated guidance on Pillar Two implementation
On 28 May 2026, the OECD published a consolidated commentary to the Global Anti-Base Erosion (GloBE) Model Rules (2026), bringing together the original 2022 Commentary and all Agreed Administrative Guidance issued by the OECD/G20 Inclusive Framework through January 2026. The publication provides tax administrations and multinational enterprise groups with a single reference source for the interpretation and application of the Pillar Two Global Minimum Tax rules. The consolidated commentary covers the scope and operation of the GloBE framework, including the Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR), the calculation of GloBE income, covered taxes and effective tax rates, as well as guidance on safe harbours, qualified domestic minimum top-up taxes (QDMTTs), tax credits and incentives, filing obligations, corporate restructurings, joint ventures, investment entities and tax-transparent entities.
OECD to host Tax and Development Days on 17-18 June 2026
On 17 and 18 June 2026, the OECD will host its annual Tax and Development Days, bringing together policymakers, tax administrations, international organisations, businesses and civil society representatives to discuss how tax policy and tax administration can support sustainable development. Under the theme “From Rules to Results: Turning Tax Policy into Development Impact”, the programme will cover a wide range of international tax topics. Discussions on 17 June will focus on tax certainty and simplification, including transfer pricing, dispute resolution through the Mutual Agreement Procedure (MAP), the Global Minimum Tax and VAT in the digital economy, as well as taxation of the extractive sector. On 18 June, sessions will address tax morale, illicit financial flows, tax crime investigations, exchange of information, taxpayer data protection, tax incentives, revenue statistics and the use of tax policy to support emission reduction objectives. The event will take place virtually, with French and Spanish interpretation available. Registration must be done online and separately for each day, for 17 June for Room 1 or Room 2, and 18 June for Room 1 or Room 2.
Save the Date: Celebrating 10 years of ETAF
