ETAF Professional Law Conference on 9 December 2025: registration is now open!
The European Tax Adviser Federation (ETAF), in cooperation with MEP Maria Grapini, is pleased to invite you to join leading voices from the European Parliament, the European Commission, Member States, academia and the tax profession for an open and forward-looking exchange on what lies ahead for the Single Market for services and how the tax profession should prepare. On-site seats are limited and will be attributed on a first-come, first-served basis. Online participation is also possible. Secure your seat now and register here.
European Commission proposes strengthened VAT cooperation between EU agencies and Member States
On 14 November 2025, the European Commission proposed a legislative amendment to strengthen cooperation between the European Public Prosecutor's Office (EPPO), the European Anti-Fraud Office (OLAF) and the Member States. The proposal provides a legal basis for the exchange of information and access to VAT data. The proposal will grant the EPPO and OLAF immediate access to VAT data, enabling a rapid, EU-wide assessment of fraud investigations. Furthermore, the proposal establishes direct communication channels between the EPPO, OLAF and Eurofisc — the European network of Member State officials tasked with combating VAT fraud — enhancing their ability to coordinate cross-border investigations and share critical intelligence in real time. The cooperation tools will unleash the potential of existing and new digital solutions regarding secure exchange of tax information for the fight against tax fraud, the Commission said. The proposal will now be submitted to the Council for agreement and to the European Parliament and the Economic and Social Committee for consultation.
Main tax outcomes of ECOFIN meeting on 13 November 2025
During the ECOFIN Council meeting on 13 November 2025, EU Finance Ministers agreed to abolish the 150 € customs duty relief threshold – a change proposed as part of the Customs Reform Package - meaning customs duties will apply from the first euro once the EU Customs Data Hub becomes operational in 2028. In the meantime, the Council made a commitment to work towards a temporary solution to levy customs duties on such goods as soon as possible in 2026 and until the Hub becomes operational. The Danish Presidency of the Council of the EU hopes to get a deal on the Customs Reform Package by the end of the year. No political agreement was reached during the meeting on the revision of the Energy Taxation Directive (ETD), originally proposed in 2021. Several Member States (namely Italy, Greece, Malta, Bulgaria, Spain, Finland, Poland, Czech Republic, Romania, Austria, Luxembourg and Slovakia) remained opposed to the current compromise text for various reasons, including concerns over gas and LPG rates, the capped indexation, the review clause allowing the Commission to reassess aviation and maritime taxation in 2035 or the overall lack of ambition of the new text. The Danish Presidency declared the file blocked and will not pursue further negotiations, though the Commission urged continued efforts toward consensus. Finally, during an in-camera breakfast session, EU Finance Ministers took stock of ongoing OECD negotiations on a possible “Side-by-Side” (SbS) regime under the OECD’s Pillar Two framework that would exempt US domestic companies from key tax provisions of the global minimum tax. Several Member States reportedly questioned the legality of implementing the SbS regime without amending the Pillar Two Directive and expressed reservations about the additional costs it may create. In a statement published after the meeting, Estonia said that if the US gets an exemption from OECD global minimum tax rules, smaller economies like Estonia should get similar flexibility to protect EU competitiveness.
Kick-start of the third session of negotiations on the UN Tax Framework
The third negotiating session of a UN Framework Convention on International Tax Cooperation has started on 10 November 2025 and will run until 19 November in Nairobi. Delegates are discussing proposals for a draft structure for the framework convention, a protocol on taxing cross-border services and rules for preventing and resolving tax disputes, with early debates focused on harmful tax practices. Countries reportedly remain divided, particularly as many high-income countries — including Germany, Japan, Saudi Arabia, Singapore, Spain and the UK — oppose references to “minimum taxes”, arguing they would duplicate OECD initiatives and could undermine tax sovereignty, while others note that several elements of the draft already overlap with existing OECD and regional efforts. Despite these concerns, many countries support retaining a section on harmful tax practices as essential for fair taxation and effective enforcement, though critics seek a more streamlined definition. All presentations can be found here.
EP adopts its final position on the BEFIT proposal
On 13 November 2025, the Plenary session of the European Parliament adopted its final position on the Business in Europe: Framework for Income Taxation (BEFIT) proposal, establishing a common way of calculating the tax base of multinationals operating in the EU. The non-binding opinion, initially drafted by MEP Evelyn Regner (S&D, Austria), introduces a “significant economic presence” clause, deeming firms with over €1 million in revenues in a Member State as permanently established there. MEPs also propose a royalties limitation rule to curb profit shifting, requiring payments to low-tax group entities (below 9%) to be added back to taxable income unless backed by real economic activity. Further measures target passive income shifted to low-tax foreign subsidiaries lacking substance, while an additional amendment allows accelerated tax write-offs for assets supporting EU climate, social, digital, or defence priorities. The text will now be transmitted to Member States to take it into account when they adopt their final text.
EP backs simplified sustainability reporting and due diligence duties
On 13 November 2025, the Plenary session of the European Parliament adopted its negotiating position on simplified sustainability reporting and due-diligence duties for businesses under the Omnibus I simplification package of 26 February. The text was approved with 382 MEPs in favour, 249 against and 13 abstentions. The European People’s Party (EPP) teamed up with European Conservatives and Reformists (ECR) and far-right Patriots for Europe (PfE) to pass the text. MEPs propose that only companies with more than 1 750 employees and over 450 € million in annual turnover should be subject to social, environmental and taxonomy-related reporting, with streamlined standards, fewer qualitative disclosures and voluntary sector-specific rules. They also recommend that due-diligence duties should apply solely to very large firms with over 5 000 employees and 1.5 billion € in turnover, using a risk-based approach that limits information requests to smaller partners to last-resort situations. Parliament also calls for an EU digital portal offering free templates, guidance and information to complement the European Single Access Point. Negotiations with EU Member States, which already adopted their position on this file, will begin on 18 November, with the aim of finalising the legislation by the end of 2025.
FISC Chair statement after visit to the US
In a statement issued on 11 November 2025, following a mission to Washington D.C. and New York from 27 – 29 October, MEP Pasquale Tridico (The Left, Italy), Chair of the European Parliament’s FISC Subcommittee, underlined the importance of the US in the global tax system and EU-US economic ties. He expressed regret over the US withdrawal from the global tax deal but welcomed the G7’s side-by-side agreement on a 15% global minimum tax rate as a step forward. “Reaching a fair agreement at OECD level that preserves EU competitiveness is more crucial than finding a quick fix by the end of the year, with possible loopholes”, he however emphasised. MEP Tridico also urged renewed dialogue on Pillar One to ensure that multinationals pay taxes where they have digital activities. He further pointed out that, without a global agreement, countries retain the right to levy digital service taxes. The delegation met with representatives of key institutions, such as the US Department of the Treasury, Congress and the United Nations, as well as with stakeholders from the private sector, experts and civil society.
FISC hearings on tobacco taxation and energy taxation on 20 November 2025
On 20 November 2025, the European Parliament’s Subcommittee on Tax Matters (FISC) will hold two public hearings. From 9:00 to 11:00, the first hearing will explore the European Commission’s recent proposals on harmonising EU taxation for new tobacco and nicotine products as well as increasing minimum tax levels. The discussion will assess potential impacts on the Single Market, providing input for Parliament’s opinion on the proposals. The draft programme can be consulted here. From 11:00 to 12:30, the second hearing entitled “Tax aspects of the clean industrial deal and the revision of the energy taxation directive,” will examine how taxation policies supporting the EU’s decarbonisation goals might influence energy taxation and the current negotiations on the revision of the Energy Taxation Directive. The draft programme is available here. Both hearings will be web streamed.
EPRS briefing on further simplification of the VAT OSS
A briefing published by the European Parliamentary Research Service (EPRS) on 11 November 2025 reviews the evolution and future of the EU’s VAT one-stop-shop (OSS) and ongoing debates on its further simplification. The OSS is the result of a gradual two-decade reform process that began in 2003 to address competitive distortions in electronically supplied services. With the Council’s adoption of the “VAT in the digital age” (VIDA) package in March 2025, the EU moved closer to a single VAT registration by minimizing the need for multiple national registrations. After VIDA, the OSS will cover nearly all B2C intra-EU transactions, marking a stage of near completeness but prompting discussion about the system’s next steps, the briefing outlines. Future reforms floated by diverse stakeholders include integrating foreign VAT refund mechanisms, improving VAT rate identification and potentially expanding the OSS to intra-EU B2B transactions. Despite growing trader participation, micro and small enterprises remain the hardest to reach, the briefing emphasises, anticipating continued future awareness efforts in collaboration with national and sectoral bodies to ensure these firms benefit from the expanded OSS framework.
