PensionsEurope input to the EC consultation on withholding taxes and the new EU system to avoid double taxation

In our input, we e.g.:

  • welcome the consultation and support the current Commission´s mandate for removing all barriers to the completion of the Capital Markets Union (CMU) – particularly in the field of simplifying taxation;
  • agree with the important remarks of the Commission on the current challenges with withholding tax (WHT) procedures across Europe;
  • warmly welcome that several EU countries have already introduced (or are planning to introduce) enhanced procedures to make WHT procedures more efficient;
  • strongly agree with the Commission that there is a need for EU action to make WHT refund/relief procedures more efficient. The high added value of an action at EU level would be that there would be an EU wide harmonized framework in place and no more fragmented WHT systems across the EU;
  • remind that we have stressed for a long time that the relief at source is the best practice for pension funds, but there are also many other recent WHT proposals which the EC should thoroughly consider;
  • remind that 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;
  • stress that establishing a cross-border investment-friendly tax environment in the EU not only requires removing unfair tax treatment but also introducing tax incentives.