August 10, 2026

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August 10, 2026

Newsletter

The European Post

Policy • Diplomacy • Strategic Insight

LATEST
Five Joint Defence Projects Launch Europe’s Military ShieldElectrification Plan Aims to Make Europe First Electro ContinentHorizon Europe Budget Fight Heats Up as Ministers Push BackGoogle’s DMA Fine Sets Off a Transatlantic Tariff ClashTwenty New University Alliances Join Erasmus for Two YearsForeign Subsidies Case Puts Temu in the EU’s SightsVan Tachographs Now Mandatory for Cross-Border FleetsStress Test Exposes Gaps in Euro Area Bank DefencesEurope Bets on a Gulf Partnership Before the Riyadh SummitWhy the Atlantic Route Now Runs Through MauritaniaKyiv and Chisinau Advance as the EU Accession Talks Gather PaceEurope’s New Digital Border System Beds In After a Rocky RolloutBrussels Mounts Its Largest Wildfire Response as the Fires SpreadRetail Spending Slipped in June, Wrong-Footing EconomistsHeatwave Warning Puts Brussels on Alert for Vulnerable GroupsKANAL’s 230 Million Euro Museum Sets a November Opening DatePension Savings Rules Get a Reset as the EU Scraps the 1% CapMedicine Shortages Move to the Heart of Europe’s Pharma ResetJapan Becomes Europe’s Closest Security Partner in AsiaCan Europe’s New Zealand Deal Anchor It in the Pacific?Five Joint Defence Projects Launch Europe’s Military ShieldElectrification Plan Aims to Make Europe First Electro ContinentHorizon Europe Budget Fight Heats Up as Ministers Push BackGoogle’s DMA Fine Sets Off a Transatlantic Tariff ClashTwenty New University Alliances Join Erasmus for Two YearsForeign Subsidies Case Puts Temu in the EU’s SightsVan Tachographs Now Mandatory for Cross-Border FleetsStress Test Exposes Gaps in Euro Area Bank DefencesEurope Bets on a Gulf Partnership Before the Riyadh SummitWhy the Atlantic Route Now Runs Through MauritaniaKyiv and Chisinau Advance as the EU Accession Talks Gather PaceEurope’s New Digital Border System Beds In After a Rocky RolloutBrussels Mounts Its Largest Wildfire Response as the Fires SpreadRetail Spending Slipped in June, Wrong-Footing EconomistsHeatwave Warning Puts Brussels on Alert for Vulnerable GroupsKANAL’s 230 Million Euro Museum Sets a November Opening DatePension Savings Rules Get a Reset as the EU Scraps the 1% CapMedicine Shortages Move to the Heart of Europe’s Pharma ResetJapan Becomes Europe’s Closest Security Partner in AsiaCan Europe’s New Zealand Deal Anchor It in the Pacific?

Tax Cooperation Rules Get an Overhaul After Eight Rounds of Patches

Rúnar Guðmundsson
Regulatory Monitor, Taxation

Dublin: In a city that has spent a decade at the centre of Europe’s arguments over corporate tax, officials are watching the European Union try to modernise the plumbing that lets national authorities share what they know. A drive to overhaul tax cooperation has moved to the front of the bloc’s agenda, aimed at a rulebook that has been patched eight times and now creaks under its own complexity.

The Commission put forward a recast of its directive on administrative cooperation, known as DAC, in late June. The framework governs how member states swap information on income, accounts, rulings and, increasingly, digital and crypto assets. Amended repeatedly since 2011, it has grown into a tangle that even specialists struggle to navigate, and the recast aims to consolidate and simplify it rather than bolt on a ninth layer.

Lawmakers are already probing the plan. The European Parliament’s tax subcommittee held a public hearing in July on the recast, weighing whether it goes far enough to close loopholes without burying smaller firms and tax offices in fresh reporting. The core promise of tax cooperation is simple, that money moving across a border should not slip out of sight of the authorities on either side.

Enforcement is running in parallel. In its July infringement package the Commission pressed Germany, France and Italy to bring their treatment of dividends paid by subsidiaries in other member states into line with the parent-subsidiary directive, a reminder that the EU polices its own tax rules as firmly as it writes new ones. The directive on administrative cooperation anchors much of that work.

Value-added tax sits on the same reform track. A Commission report this summer concluded that the long-standing VAT exemption for financial services no longer fits modern markets, leaving an annual policy gap it estimated at around 52 billion euros. Officials are pressing ahead with the digital VAT package too, building the reporting systems and single-registration rules that will reshape how businesses account for the tax across borders.

The politics remain delicate. Tax is one of the few areas where member states still hold a veto, so every step toward tighter cooperation requires unanimity and the patience to win over capitals that guard their fiscal sovereignty. Ireland, whose low rate drew both investment and criticism, knows the sensitivity better than most, and its officials tend to read each new proposal for how far it reaches into national choices.

For companies, the direction is unmistakable. More information will flow automatically between tax offices, more transactions will leave a digital trail, and the space to arbitrage the gaps between systems will narrow. Whether the recast delivers the simpler, sharper regime the Commission promises, or merely reorganises the complexity, will become clear as the Parliament and member states work through the text over the months ahead.

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