EU: Eliminating Tax Evasion
The European Commission has adopted an amending proposal to the Savings Taxation Directive, with a view to closing existing loopholes and eliminating tax evasion.
The Commission proposal seeks to better ensure the taxation of interest payments channelled through tax-exempted structures. It also proposes to extend the scope of the Directive to income equivalent to interest obtained through investments in some innovative financial products as well as in certain life insurance products.
Since 2005, the Savings Directive ensures that paying agents either report interest income received by taxpayers resident in other EU Member States or levy a withholding tax on the interest income received.
László Kovács, Commissioner for Taxation and Customs, said: “The first report on the operation of the Savings Taxation Directive concluded that the Directive, although effective within the limits of its scope, can be easily circumvented. The current scope of the Directive needs to be extended, in order to meet our goal of stamping out tax evasion, which affects the national budgets and creates disadvantages for the honest citizens.”
For full details of the amending proposals see
