Related items

AmCham EU has joined 22 other business, financial and professional associations in calling on Member States to reach agreement on the Commission’s Tax Simplification Package. The measures could save businesses operating in Europe around €8 billion a year, money currently absorbed by complexity rather than invested in growth. Tax collected only to be refunded and withholding taxes that hinder investment in the Single Market add costs without strengthening the tax base. Europe has already strengthened its tax framework, so simplification can go ahead without weakening enforcement. Agreement will only matter if the ambition of the package survives the negotiations. Read the full joint statement here. 

The reform of the Union Customs Code changes who is treated as the ‘importer’ when a non-EU company uses an indirect customs representative. That creates a problem under the EU VAT Directive, which links import VAT deduction to being identified as the importer or consignee. In practice, the non-EU company may no longer meet that requirement, while the customs representative may not qualify for the deduction either.

That could leave import VAT irrecoverable and create uncertainty for businesses using established import models. The Commission should ensure that the non-EU principal can still be identified in customs data for VAT purposes and fix the mismatch between the UCC and the VAT Directive.

Learn more about what changes are needed to keep import VAT deductibility workable under the new customs framework.

The Draghi report highlights how economic growth has stagnated in the EU due to structural weaknesses that risk undermining the EU’s global competitiveness. To bolster the EU’s attractiveness and competitiveness, lawmakers should pursue a coherent pro-growth tax reform agenda. A pro-growth tax reform agenda in the EU27 can be evaluated through five principles: (a) economic efficiency, including low distortion of economic decisions and low administrative and compliance costs; (b) consideration and strong discipline across the entire lifecycle of tax policy reform: initial decision making process, legal design and implementation; (c) evidence-based accountability through clear objectives, rigorous impact assessment, meaningful consultation and ex post review; (d) strengthening the Single Market rather than adding cross-border frictions; and (e) neutrality and fair competitive conditions across sectors, countries and business models.

These principles are mutually reinforcing: growth is supported not only by sound and coherent statutory design, but by the full tax system including law, administration and taxpayer interaction. AmCham EU has prepared a framework for EU lawmakers to use while designing, implementing and evaluating tax policy based upon our members’ experiences operating in every EU Member State and almost every country around the world.