New EU system for the avoidance of double taxation in the field of withholding taxes

We are pleased to respond on behalf of the Deloitte firms in the European Union to the European Commission Public Consultation on the Proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes (the FASTER Proposal) presented on 19 June 2023 and welcome the opportunity for debate on this topic. Please refer to our letter for further details and comments on the FASTER Proposal.

For BETTER FINANCE, the ECs FASTER Proposal can bring procedural progress in addressing longstanding obstacles to tax recovery for investors dealing with their cross-border investment income. We welcome an EU-wide framework to streamline withholding tax refund modalities.

BNY Mellon welcomes the opportunity to give feedback on the FASTER Proposal. We support many elements of the Proposal, and believe that, if the Proposal is implemented, it will make a significant contribution to improving the attractiveness of European capital markets.

The European Public Real Estate Association (EPRA), the voice of Europe's listed real estate companies, welcomes this proposal as a means to enhance greater participation in EU capital markets. The set of measures presented in the proposal represents a consistent stride towards a more streamlined and expeditious process for refunding excessive withholding taxes.

ALFI welcomes the public consultation on the proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes released on 19 June 2023 and introducing a new EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes (the draft Directive).

Despite the intention to make reimbursement and doctroi procedures prior to the conventional benefits more efficient, the proposed Directive does not meet stakeholders’ expectations. With conflicting aims, several of its provisions appear inconsistent, ineffective and non-operational.

Filed in French · English published by the European Commission

Invest Europe welcomes the European Commissions proposal of the Directive on Faster and Safer Relief of Excess Withholding Taxes and the initiative to introduce a common EU-wide system for withholding tax on dividend or interest payments, as we encourage the idea of removing tax barriers to cross-border investment.

The American Chamber of Commerce to the European Union (AmCham EU) recognises the contribution the FASTER Proposal would make to simplifying withholding tax (WHT) procedures for cross-border investments in the EU. Please find our consultation response attached.

AEIP fully supports the initiative to improve withholding taxes (WHT) procedures and the Commissions proposal to implement relief at source and/or quick refund procedures for excess WHT. FASTER offers numerous advantages to pension funds, primarily through its streamlining of the process, standardized data requirements, and simplified form submissions.

The European Commission has released on 19 June 2023 a Proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes (the Proposal). It introduces a common EU digital certificate of tax residence and two fast track procedures including, at Member States discretion, a relief at source procedure and / or a quick refund procedure.

CFE Tax Advisers Europe has now published an Opinion Statement concerning the EU Commissions withholding tax proposal to introduce legislation on a new EU system for the avoidance of double taxation and prevention of tax abuse: Faster and Safer Relief of Excess Withholding Taxes.

We welcome the consultation of the European Commission (EC) relating to the Council Directive on Faster and Safer Relief of Excess Withholding Taxes published on 19 June 2023 and are pleased to provide input. We agree fully with the ECs assessment that inefficient withholding tax relief procedures are one of the main obstacles to the free movement of capital and to the integration of capital markets.

The EBF welcomes efforts at simplification and digitisation of withholding tax processes within the Union. Slow and complex withholding tax reclaim processes remain barriers to efficient investment. A simple, swift, and safe system would encourage intra-union and foreign investment. Nevertheless, the proposed rules remain complex and would require significant due diligence and reporting.

UK Finance is the collective voice for the banking and finance industry operating in and from the UK, representing more than 300 domestic and international firms. Our members include businesses that are large and small, corporate and mutual, retail and wholesale.

AFG welcomes and supports the FASTER proposal by the European Commission, which objective is to build a common European Union-wide system for refunding excess withholding taxes (WHT) that is safer and more efficient for investors.

The Association for Financial Markets in Europe (AFME) welcomes the opportunity to comment on the European Commissions Proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes (FASTER). AFME strongly supports the Commissions objectives to simplify and digitise withholding tax processes within the EU.

The European Association of Co-operative Banks (EACB) would like to stress that implementing a standardised EU-wide system of withholding tax (WHT) relief at source would be the best option as it can be implemented in the most resource-efficient way from the banks' perspective.

As a statutory umbrella organisation, the Federal Chamber of Tax Consultants represents the totality of over 100.000 tax advisors, tax agents and tax-advising professional companies at national and international level. It coordinates the formation of the opinions of the chambers of tax advisers and, on that basis, participates in the deliberations on tax laws and in the design of professional law.

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Xceptor welcome the EU Commission initiative to harmonise and simplify the withholding tax procedures within the European Union, while preventing double taxation and tax abuse. We strongly believe that technology plays a key role in this initiative and that an incredible opportunity exists to modernise and digitise the current withholding tax processes across Europe.

We appreciate the opportunity to submit the attached comments on behalf of EY on the European Commissions public consultation of 19 June 2023 on a new EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes.

1. We agree on the desirability of a common, standardised EU-wide system of exemptions and reductions of withholding taxes on cross-border income flows. This would reduce the impact of double taxation and would be a significant improvement on the current situation where several procedures are still based on paper documents, resulting in the need to apply for different originals, with long lead times and inconsistent…

PensionsEurope welcomes the European Commission's proposal for a Faster and Safer Relief of Excess Withholding Taxes (FASTER). As cross-border investors, with 2.4 trillion euros of assets for EEA institutions for occupational retirement provision (IORPs) at the end of 2022, pension funds bear witness to investment barriers and costs within the single market which ultimately impact negatively pension fund members and…

The New Zealand Superannuation Fund (NZSF) welcomes the European Commissions Proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes released which proposes new rules in relation to withholding tax procedures. Our submission points are made in the attached document.

KPMG member firms in the EU are pleased to provide comments on the European Commissions public consultation on a Proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes (FASTER) on a common EU-wide system for withholding tax on dividend and interest payments.

The Investment Company Institute (ICI) and the Investment Association (IA) urge clarification regarding the application of the Commissions proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes (FASTER) to non-EU investors.

The Fédération Bancaire Française (FBF), as the spokesperson of the French banking sector representing the interests of more than 300 banks operating in France, including large and small, wholesale and retail financial institutions, local and cross-border, welcomes the opportunity to comment on the public consultation on FASTER Directive 2023/0187 on faster and safer withholding tax relief and to provide its…

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AMAFI represents the financial market participants in the sell-side, established in France. The Association comprises more than 170 French and international institutions of all sizes, including investment firms, credit institutions, brokers, stock exchanges and private banks. They intervene in all market segments, including equity, bonds and derivatives, including commodity derivatives.

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As a global withholding tax recovery service provider assisting institutional and retail investors in obtaining tax relief and retrospective tax recoveries pursuant to prevailing tax treaties or national legislation, WTax welcomes the European Commission's FASTER directive WTax appreciates the continued opportunity to provide feedback and comments on the Commissions proposal for the Directive.

The Dutch Federation of Pension Funds would like to give its support to the legislative proposal FASTER for faster and safer relief of excess withholding taxes. We highlight the benefits of the proposed directive for a uniform and quick withholding tax relief system. We call on EU policy makers to make quick progress on FASTER, so it enters into application as soon as possible.

In principle, the German Tax Consultants Association (DStV) welcomes the Commission’s proposal for faster and secure procedures for the relief of excess withholding taxes (COM (2023) 324). This is particularly in view of the fact that the cross-border investor (hereinafter: Investors) in the case of double taxation treaties usually have a legal right to a refund of excess withholding taxes.

Filed in German · English published by the European Commission

FRANCE POST-MARCHE (FPM) is the leading association representing the post-trade business in France and Europe. FPM fully agrees with the general objectives of this proposal: - Remove barriers to cross-border investment (Capital Market Union) - Strengthen Member States ability to prevent and fight against potential fraud and abuse - Improve processes for the benefit of investors However, we fear that the balance…

As a leading player in the post-trade financial services sector, and hence providing asset servicing solutions to our clients like withholding tax procedures management, Euroclear welcomes the European Commissions FASTER directive. We see this as a significant and progressive step towards harmonising the complex landscape of withholding tax procedures across EU member states.

Interested party: Association NATIONALE DES SOCIETES BY ACTIONS (ANSA) 39 Rue de Prony 75017 PARIS FRANCE Number of the Transparency Register of the European Union: 236569017571-35 national corporation by shares (ANSA) is pleased to note that the public consultation concerns the establishment of a new EU system to avoid double taxation and prevent abusive tax practices in the field of withholding taxes.

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Dear Sirs, Please find attached the Polish Bank Association position on the Proposal for a Council Directive on Faster and Safer Relief of Excess Withholding Taxes. We remain at your disposal for any further questions. Yours faithfully, [name removed] to Management Board Polish Bank Association

BNP Paribas is a top-tier European and international banking establishment supporting all its customers individuals, associations, entrepreneurs, SMEs and institutions in the success of their projects through its financing, investment, savings and protection solutions. We welcome the European Commissions directive to simplify and digitalise withholding tax processes within the European Union.

European Savings and Retail Banking Group (ESBG) welcomes the opportunity to provide feedback to the European Commission's consultation on the "New EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes". ESBG is pleased to provide the comments in the attached document.

Deutsche Börse Group (DBG) would like to express appreciation for the opportunity to respond to the proposed "Faster and Safer Relief of Excess Withholding Taxes" Initiative (FASTER). As a company advocating for a stronger European capital market, we firmly believe that this initiative is a crucial step, aiming to address tax barriers to cross-border investment, simplify taxation, and introduce a common EU-wide…

The German Taxpayer Institute of the German Taxpayers' Association (www.steuerzahler.de/dsi/) welcomes the initiative of the European Commission. Frequent feedback from many citizens tells us that the issue of double taxation is a significant source of frustration, especially for small-scale investors.

I propose to extend this initiative also to withholding taxes on royalties / license fees. According to our experience it is very bureaucratic and takes very long time to get the application of the double taxation treaties granted and excess withholding tax refunded.

Finance Finland welcomes the European Commission’s initiative to introduce a common EU-wide system for withholding tax on dividend payments. Complicated and different withholding tax processes form a substantial barrier to cross-border investments within the EU and it is important that withholding tax processes should be harmonized.

ACA welcomes the possibility to comment on this roadmap. As other actors, we believe that cross-border investment and simplified taxation should be a priority for the EU and that tax barriers to cross-border investment should be removed. However, nowadays, too often, the process to claim a refund looks more like an obstacle course than a legitimate right.

Dear all, we thank you very much for the great opportunity to give feedback/input. My colleagues- from the tax reclaim department want to give the following input: From pure operational point of view : - Administrative burdensome should be tackled and reduced (i.e. paper work must be reduced because for each market we destroy the Amazon forest). - Same for client, we receive back sometimes forms that they printed.

The Association for Financial Markets in Europe (AFME) welcomes the opportunity to provide its feedback to the European Commission on the “New EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes”. Our comments on the Inception Impact Assessment have been submitted via a separate document. We would be pleased to assist with this initiative.

Invest Europe welcomes the European Commission’s initiative to investigate a common EU-wide system for withholding tax on dividend or interest payments, as we encourage the idea of removing tax barriers to cross-border investment.

The members of the European Association of Co-operative Banks (EACB) gladly take the opportunity to comment on the European Commission’s roadmap consultation “New EU system for the avoidance of double taxation and prevention of tax abuse in the field of withholding taxes”.

The French Association of Large Companies (AFEP) welcomes the opportunity to answer this consultation on the Commission's roadmap. This initiative is particularly welcomed by French large companies in a context where Member States are multiplying domestic measures to restrain access to these benefits by introducing very heavy administrative processes.

WTax supports the implementation of a standardized and efficient EU-wide system for withholding tax relief. WTax appreciates the opportunity to respond to the policy options outlined in the Commission’s Inception Impact Assessment for the initiative regarding a new EU system to avoid double taxation. We provide our views in the attached letter.

BNY Mellon supports the implementation of a standardized EU-wide system for withholding tax relief at source. We believe that that this is a necessary feature of a European Capital Markets Union. Accordingly, we support Policy Option 2. However, Policy Option 2 should be complemented by Policy Option 3, as any effective common system of relief at source will need to be founded on extensive exchanges of information.

The Association of Global Custodians welcomes the Commission's initiative to improve withholding tax procedures within the EU. As detailed in the attached letter, we believe a well-functioning relief at source system must be the primary solution (based on standardized documentation, investor self-certification, and electronic data transmission), supplemented by simplified and streamlined reclaim procedures and…

European Commission has requested feedback for the initiative Aiming to introduce a common EU-wide system for withholding tax on dividend or payments interest. In accordance with the Inception Impact Assessment dated on 28 September 2021, feedback is requested e.g. on possible solutions and impacts of the different options.

Filed in Finnish · English published by the European Commission

The European Tax Adviser Federation (ETAF) welcomes the European Commission’s intention to present, by the end of 2022, a proposal to establish a European withholding tax framework on dividend or interest payments. In principle, ETAF acknowledges that withholding taxes as such can reduce the risk of tax evasion and avoidance.

The Investment Company Institute (ICI), including ICI Global—on behalf of collective investment vehicle (CIV) investors— supports strongly a widely applicable, practical, and reliable mechanism for providing investors with appropriate treaty relief.

IHS Markit greatly appreciates the opportunity to comment on the “New EU System For The Avoidance of Double Taxation and Prevention of Tax Abuse In The Field of Withholding Taxes”. Our comments in support of this initiative have been submitted via a separate document. We look forward to working with you on this initiative.

As has been made for VAT refunds to non-established taxpayers, where the procedure and documentation to be submitted has been standardised and digitised across the EU Member States, regarding withholding tax at source we propose: 1.

Mouvement des Entreprises de France (MEDEF) welcomes the European Commission's initiative to address the issue of burdensome withholding tax relief procedures for cross-border investors with respect to certain types of income (mainly dividends, interest and royalties). This is a long-standing problem on which little progress has been made in recent years.

Insurance Europe welcomes the possibility to comment on this roadmap. Provisions around withholding tax procedures for cross-border portfolio investors or shareholders in the EU, which are different between member states, often pose a challenge to insurers in regard to cross-border investment, due to their complexity and the related costs.

We welcomes the EC’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 EC´s mandate call for removing all barriers to the completion of the CMU – particularly in the field of simplifying taxation.

The state of the art concerning taxation at source of dividends is not satisfactory, as the ever increasing amount of frauds and the burdensome compliance procedure and costs confirm all around Europe. Stakeholders, taxpayers and Tax administrations are in need of solutions capable of simplifying tax reimbursement protocols (should the withholding tax charged exceed the amount ruled by the treaty applicable) and…

Temasek International Pte Ltd is grateful for this opportunity to respond to the three policy options outlined in the Commission’s Inception Impact Assessment. We provide our views in the attached letter and are happy to respond to any questions the Commission may have.

The obstacles outlined are widely acknowledged as both long standing and challenging. I welcome the advances the commission is making to tackle these difficult issues; having worked in the custody tax industry for 25 years, I have direct experience of the challenges faced by investors, (individuals, pension funds and regulated investment funds) and financial intermediaries (brokers, banks, CSDs).

There’s a broad consensus that the current processes of claiming Tax Relief in the EU are extremely lengthy, resource-intensive and costly mainly due to the lack of digitalised procedures and the existence of complex and divergent processes across EU Member States.

The Commission’s efforts to establish a common system to avoid withholding taxes is very welcome. The obstacles and burdens currently faced by investors in order to obtain tax at source on their investments in accordance with the Agreement are in many cases disproportionately regulated, particularly in the case of private investors, and, above all, vary widely in national legal systems.

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