An EU report published in September covers the use of the EU Mutual Assistance Directive. This Directive has been around for a while in one shape or form, and its 2008 incarnation permits Revenue Authorities to recover their claims for most taxes in other EU Member States. But only 5% of the amounts claimed are actually recovered.

According to the report, which focuses on data from recent years, there has been a six fold increase between 2003 and 2008 in the amounts of tax recovered under mutual assistance. Nevertheless the authors are of the view that “there are still many cases where Member States do not avail of the possibilities offered by the Directive.” That would seem fairly obvious – across the EU as a whole there were only 8,000 or so requests between Revenue Authorities for help in collecting cash in 2008, and the volume of requests seems to have declined.

The report concludes by recommending that Member States should “strengthen the recovery instruments available in their domestic legislation” and that EU proposals earlier this year to improve mutual assistance should be adopted.

More details are available at http://ec.europa.eu/taxation_customs/taxation/tax_cooperation/tax_recovery/index_en.htm