Hello.
We are know how dealing with double taxation of dividends is problematic when investing abroad, including European countries. European Commission realized having complicated and incoherent relief at source/refund system kind of do not match of common market idea, so new European Commission imitative followed as a part of Capital markets union 2020 action plan, which is addressing this problem.
Currently public consultation are open (01 April 2022 to 26 June 2022).
I have already submitted my questionnaire, it consist mostly of question where you can select most fitting answers. It is translated to some or all official EU languages.
here I copied introduction.
“Why we are consulting Non-resident investors’ right to a lower rate or exemption of withholding tax as laid down in double tax treaties or national rules are not always fully ensured by current functioning of withholding refund/relief procedures throughout the EU. Withholding tax refund procedures for cross-border payments have proved to be lengthy, resource-intensive and costly for both investors and tax administrations due to the difficulties for tax administrations to properly assess the entitlement to reduced withholding tax rates and the lack of digitalized procedures. On top of that, the procedures have been abused as reported by a consortium of investigative journalists that showed the existence of an alleged large-scale tax fraud known as “Cum/Ex” and “Cum/Cum” schemes in some EU Member States.As a result non-resident portfolio investors may not exercise their right to apply for the tax treaty benefits, therefore, leading to double taxation and making it less attractive to invest in the EU market. The European Commission is preparing an initiative on improving withholding tax procedures for non-resident investors. The withholding tax initiative aims to provide Member States with the information to prevent tax abuse in the field of withholding taxes and, at the same time, accommodate a swift and efficient processing of the requests for a refund and/or a relief at source procedures of the excess taxes withheld. In this context, the Commission is inviting the public and stakeholders to express their views on the problems at stake as well as on possible measures and their potential impacts. Information received in this consultation will support the impact assessment that the European Commission is currently carrying out.”
So far 800 respondents participated, mostly from Spain and Germany.
Oh, also if you are from outside EU, do not hesitate and take a part in consultation too! In questionnaire there are question about allowing people outside EU to participate in a new system too!
Can't wait when it goes live!
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