Commission launches public consultation on withholding tax procedures

The European Commission has published a Public Consultation on an initiative to improve withholding tax procedures for non-resident investors. Withholding tax refund procedures for cross-border payments have proved to be lengthy, resource-intensive and costly for both investors and tax administrations, as tax administrations have difficulties in assessing the entitlement to reduced withholding tax rates. On top of that, these procedures have sometimes been abused, as reported by journalists in the “Cum/Ex” and “Cum/Cum” scandals in some EU Member States.

The withholding tax initiative aims to provide Member States with the information needed to prevent tax abuse in the field of withholding taxes and, at the same time, accommodate the swifter and more efficient withholding tax refund or relief procedures for investors, tax administrations and financial intermediaries alike.

Stakeholders are invited to provide input by the 26 June 2022 deadline. More information is available here.