On 25 June 2026, the European Commission published a proposal for a Council Directive that would amend six existing EU direct tax directives to simplify cross-border tax rules, reduce compliance costs, and boost competitiveness. The proposal, based on Article 115 TFEU, targets directives on interest and royalty payments (2003/49/EC), cross-border mergers (2009/133/EC), parent-subsidiary taxation (2011/96/EU), anti-tax avoidance (2016/1164), tax dispute resolution (2017/1852), and a 2025 directive on withholding tax relief. The Commission estimates that the preferred option—a comprehensive omnibus approach—could reduce compliance and financial costs by about €6.6 billion per year, including €2 billion in recurrent administrative burden, and increase EU GDP by up to 0.2% in the long run through measures such as immediate expensing of certain R&D assets.
The proposal follows a Call for Evidence from 16 February to 30 March 2026 that received 117 contributions, bilateral meetings with all Member States, interviews with over 75 stakeholders, and input from the Platform on Tax Good Governance and the Joint Research Centre (using the CORTAX model). The Commission argues that only EU-level action can effectively simplify cross-border tax rules, reduce double taxation, enhance legal certainty, and eliminate outdated provisions, as national action alone would fragment the internal market. The proposal now requires unanimous adoption by the Council, after consulting the European Parliament and the Economic and Social Committee.
EU businesses operating cross-border stand to benefit most from reduced compliance costs and streamlined procedures, potentially saving billions annually. National tax authorities will face implementation costs to transpose the amendments into domestic law, but may gain from simplified administration. Tax advisors and legal firms may see reduced demand for compliance services, while EU taxpayers could indirectly benefit from increased economic growth and competitiveness. The proposal also aims to address inconsistent application across Member States, which has been a source of legal uncertainty for companies.
The Council must now examine the proposal, with the European Parliament and the Economic and Social Committee delivering opinions. Unanimity among Member States is required for adoption, which could prove challenging given differing national tax priorities. The Commission has indicated that the omnibus approach is the most effective way to achieve simplification, but Member States may push back on specific provisions that affect their tax sovereignty.