A Commission staff working document published on 24 June 2026 sets out the impact assessment for a proposed recast of the EU Directive on administrative cooperation in taxation (DAC), aiming to simplify rules and cut reporting burdens for businesses and tax administrations across all Member States.
The document accompanies a formal proposal for a Council Directive on administrative cooperation in the field of taxation (recast). It identifies the current DAC framework (DAC1–DAC9) as fragmented, creating legal uncertainty and disproportionate compliance costs, especially from low-value reporting under DAC4, DAC6, DAC7 and DAC9. The preferred package includes: excluding all companies within the scope of the Pillar 2 Directive from DAC6 reporting; removing category A hallmarks; issuing guidance on the Main Benefit Test; raising the DAC7 monetary threshold to EUR 3,000 and removing the activity threshold; introducing a single notification obligation for DAC4 and DAC9 with a harmonised deadline and central filing; creating a centralised TIN verification system (compulsory for Member States, voluntary for reporting entities); removing life insurance products from DAC1 and requiring automatic exchange on the remaining six categories.
The estimated costs for the EU-level TIN system are EUR 1.0–1.8 million one-off and EUR 1.8–2.4 million per year recurrent. At national level, costs are estimated at EUR 15–25 million one-off and EUR 4.5–12 million per year recurrent. The recast also includes a review clause requiring evaluation every five years under Article 27 of the DAC.
Policy orientations and trade-offs The recast balances simplification and burden reduction against the need for effective tax transparency. Excluding Pillar 2 companies from DAC6 and raising DAC7 thresholds reduces compliance costs for businesses, particularly SMEs and intermediaries, but may reduce the volume of information exchanged, potentially limiting tax authorities' ability to detect aggressive tax planning. The centralised TIN verification system improves data quality and reduces errors, but imposes upfront investment costs on Member States and voluntary costs on reporting entities. Removing life insurance products from automatic exchange reduces administrative burden for insurers and tax administrations, but narrows the scope of information exchanged.
Impact on stakeholders - Businesses and intermediaries: Moderate positive impact from reduced reporting obligations (DAC6 exclusions, higher DAC7 threshold, single notification). Compliance cost savings are expected, especially for multinational groups and digital platform operators. - Tax administrations: Mixed impact. Reduced processing of low-value reports frees resources, but national authorities must invest in the TIN system (EUR 15–25 million one-off) and adapt to new procedures. - EU taxpayers: Indirect positive impact from more efficient tax administration and reduced costs passed on by businesses, but potential negative impact if reduced reporting leads to lower tax compliance enforcement. - EU institutions: The Commission and Council gain a streamlined legal framework with a five-year review cycle, but must monitor implementation and ensure Member States comply with new obligations.
Institutional follow-up The proposal now passes to the Council for negotiation and adoption. The European Parliament will be consulted. Member States are expected to scrutinise the cost estimates and the scope of simplifications, particularly the DAC6 exclusions and the mandatory nature of the TIN system. The recast is part of a broader EU effort to modernise tax administration and reduce regulatory burdens, aligning with the Commission's competitiveness agenda.