In a written answer to a parliamentary question from Sophia Kircher (PPE), Commissioner Wopke Hoekstra said the Commission does not envisage introducing a standardised or largely automated EU-wide ‘relief-at-source’ procedure for dividend withholding taxes before 2030, arguing that the FASTER Directive (EU) 2025/50 already resolves practical obstacles by standardising and making refund procedures more efficient and fraud-proof. The answer, dated 4 August 2026, responds to concerns that retail investors face long and onerous reclaim processes for foreign dividends within the EU, often losing their entitlements permanently. Hoekstra noted that Member States may keep their existing comprehensive relief-at-source systems for dividends on publicly traded shares if their market capitalisation ratio is below 1.5%, but he did not commit to further harmonisation in the near term.
Kircher’s question highlighted that while refunds for US securities are relatively easy, intra-EU obstacles remain significant, and that FASTER measures will not apply until 2030 and will only partially solve the problem. Hoekstra’s answer points to two other initiatives as the Commission’s main response. On 24 June 2026, the Commission proposed the Taxation Omnibus Directive, which would abolish withholding taxes on cross-border payments of dividends, interest and royalties between EU companies, a measure Hoekstra said would strengthen the Single Market and support the Savings and Investments Union. In addition, the scope of the Parent-Subsidiary Directive would be extended to pension institutions, allowing them to benefit from withholding tax exemptions on dividends from other Member States. The answer also recalls the Commission Recommendation on Savings and Investment Accounts of 30 September 2025, which promotes tax simplification to boost investment accessibility.
The answer is largely declarative and does not set new deadlines or numerical targets beyond the 2030 horizon for FASTER. It signals that the Commission prefers targeted legislative fixes—such as the Omnibus proposal—over a sweeping EU-wide relief-at-source system, which would require unanimous agreement among Member States and significant administrative harmonisation. The practical impact for retail investors remains limited in the short term: they will continue to rely on existing reclaim procedures until FASTER is fully applied, and the proposed Omnibus measures primarily benefit companies and pension institutions rather than individual investors. The Commission’s position reflects a trade-off between simplifying cross-border investment and respecting Member States’ fiscal sovereignty, with the 1.5% market capitalisation threshold preserving flexibility for smaller markets. Institutional follow-up will depend on the Council’s progress on the Omnibus proposal, which requires unanimity, and on the transposition of FASTER by Member States ahead of the 2030 application date.