PensionsEurope welcomes the European Commission’s roadmap on the new EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes (WHT). We support the current Commission´s mandate call for removing all barriers to the completion of the Capital Markets Union (CMU) – particularly in the field of simplifying taxation. We agree with the important remarks of the Commission on the current challenges with WHT procedures across Europe, and we have explained those challenges and obstacles from pension funds’ point of view in PensionsEurope position paper on the withholding tax refund barriers to cross-border investment in the EU.
We agree with the objective that a standardised relief at source system becomes the principal mechanism for WHT relief procedures and their streamlining. We have stressed for a long time that the relief at source is the best practice for pension funds. We warmly welcome the action of the Commission ‘Action Plan for fair and simple taxation supporting the recovery strategy’ to introduce a common, standardised EU-wide system for withholding tax relief at source. However, there are also many other recent WHT proposals which the EC should thoroughly consider.
PensionsEurope has proposed to the Commission to establish an EU tax register of recognised pension institutions in order that Member States can reciprocally and automatically recognise pension institutions. Furthermore, in many countries pension institutions invest cross border via specialised investments funds and/or vehicles to increase the economies of scale, and it is important to ensure a tax-neutral treatment of these investment structures as well.