On 24 June 2026, the European Commission proposed a recast of the Council Directive on administrative cooperation in the field of taxation (DAC), aiming to simplify and consolidate the legal framework for tax authorities and businesses across the EU. The proposal, published as COM(2026)308 by the Directorate-General for Taxation and Customs Union (TAXUD), seeks to reduce administrative burdens by at least 25% for all companies and at least 35% for small and medium-sized enterprises (SMEs).
The recast codifies the original DAC and its eight amendments (DAC1 through DAC9) into a single legal act to improve coherence and legal certainty. It simplifies reporting obligations under DAC6 by removing requirements with limited added value, addresses overlapping notification obligations for DAC4 and DAC9, and adjusts thresholds for DAC7 reporting on the sale of goods. The proposal also updates references to align with the new EU Anti-Money Laundering framework (Directive (EU) 2024/1640) and introduces the optional use of the European Unique Identifier (EUID) for taxpayer identification. It follows the "once-only" principle for information submission under DAC1, meaning businesses will not have to submit the same information multiple times.
The proposal preserves existing safeguards and does not lower protection against tax fraud, evasion, or avoidance. It is a legislative proposal requiring unanimous adoption by the Council of the European Union, after consulting the European Parliament. The expected institutional follow-up involves discussions in the Council's working party on tax questions and a non-binding opinion from the European Parliament's Economic and Monetary Affairs Committee.
EU businesses, particularly SMEs, stand to benefit from reduced reporting burdens and simplified compliance, potentially lowering costs. National tax authorities will face initial adaptation costs to implement the recast but may gain efficiency from clearer rules and reduced overlapping obligations. Tax advisors and intermediaries may see changes in demand for compliance services as reporting requirements are streamlined. Civil society and anti-tax-avoidance advocates may welcome the preservation of safeguards but could scrutinise whether simplifications inadvertently create loopholes. The trade-off lies between reducing administrative costs for businesses and maintaining robust tax transparency and cooperation among Member States.