EUROGROUP,COUNCIL OF THE EUROPEAN UNION latest news

 

Press material Tuesday, 14 May 2024

● Eurogroup   14/05/2024 19:34 | Press release | Eurogroup President statement on the follow-up to the Eurogroup agreement on the future of the Capital Markets Union   The Eurogroup agreed on a statement on the future of the Capital Markets Union (CMU) in March and yesterday we took the first step towards its delivery. The endorsement by EU leaders at the Euro Summit and the subsequent discussion at the European Council have confirmed the timeliness of the priorities we have agreed. Delivering a true CMU will not happen all at once as a single event but will evolve through consistent and concrete steps that collectively will deliver on the vision to which we have committed ourselves. There are two broad avenues for follow-up on our statement – initiatives to be brought forward by the European Commission over the course of the next legislative cycle and measures at the national level. Ministers endorsed yesterday a high-level work programme on CMU which will ensure that the implementation of our agreement remains on the top of our agenda. This work programme will be taken forward by Ministers assisted by our Deputies, building on the relevant technical support structures. This will ensure that the Eurogroup in inclusive format remains seized of progress on the implementation of our agreement. High-level roadmap for follow-up to the Eurogroup statement on the future of CMU in Eurogroup inclusive format

Meetings Tuesday, 14 May 2024

● Council of the EU   14/05/2024 18:30 | Meetings | Main results - Education, Youth, Culture and Sport Council, 13-14 May 2024   Ministers for culture and sport met in Brussels to discuss support for influencers, the potential impact of artificial intelligence on the cultural and creative sectors, and the contribution of self-organised sport to healthy lifestyles.

Meetings Tuesday, 14 May 2024

● Council of the EU   14/05/2024 17:00 | Meetings | Main results - Economic and Financial Affairs Council, 14 May 2024   The Council reached an agreement on the directive on making the relief of excess withholding taxes faster and safer (FASTER). The Council approved conclusions on financial literacy and on the fiscal sustainability challenges arising from ageing. Ministers discussed the VAT in the digital age package, the implementation of the Recovery and Resilience Facility and the economic and financial impact of Russia’s aggression against Ukraine.

Press material Tuesday, 14 May 2024

● Council of the EU   14/05/2024 15:53 | Press release | Capital markets Union: Council approves conclusions on financial literacy   The Council today approved conclusions on financial literacy. The conclusions aim to give guidance to the Commission and the member states on how to improve citizen’s knowledge and understanding of finance, in order to help them make more informed financial choices and to encourage them to invest on European financial markets. Strengthening people’s financial literacy is of utmost importance for building a more ambitious, inclusive and resilient Capital Markets Union. I am pleased that the process we started at our informal ECOFIN in Ghent in February 2024 has now resulted in Council conclusions. Financial literacy is of utmost importance if we wish to channel dormant savings towards productive investment projects. The better educated people are about their personal finances, the more likely they are to make the best financial decisions for themselves and for society at large. Belgian minister of Finance The Council in its conclusions notes that people who are financially literate make more informed choices about their own finances and are better equipped to prepare and invest for the future. This includes retirement and other investment projects. Better knowledge about personal finances would foster retail participation in capital markets and contribute to overall enhanced financial stability in the EU. The Council recognises that financial literacy benefits individuals but also more broadly society. The Council welcomes the fact that several member states have developed and implemented national financial literacy strategies. It encourages other member states to do so, with particular attention to financially vulnerable groups, like young people, people with lower incomes and lower levels of general education, gender inequality issues as well as the specific needs of migrants and people with disabilities. The Council also points out the importance of potential entrepreneurs and SMEs having appropriate levels of financial literacy. The Council encourages member states to consider integrating financial education in school curricula and foster financial education for adults through events, seminars, workshops and awareness raising campaigns. It calls on the Commission to support actions that can be delivered via non-legislative means, such as the Technical Support Instrument (TSI) and the Erasmus+ programme to fund financial literacy projects and recommends to the Commission to facilitate trainings, professional development, research opportunities. The Council also urges the Commission, member states and stakeholders to stimulate research and collaboration by considering funding opportunities to improve financial literacy in the EU. Council Conclusions on Financial Literacy

Press material Tuesday, 14 May 2024

● Council of the EU   14/05/2024 15:34 | Press release | Taxation: Council agrees on new rules for withholding tax procedures (FASTER)   The Council today reached an agreement (general approach) on safer and faster procedures to obtain double taxation relief, which will help boost cross-border investment and help fight tax abuse. The so-called FASTER initiative aims to make withholding tax procedures in the EU safer and more efficient for cross-border investors, national tax authorities and financial intermediaries, such as banks or investment platforms. Aligning our tax relief procedures is essential if we want to improve the functioning of the capital markets union. I’m glad we have found an agreement on this important proposal, which will also help to fight tax fraud much more efficiently. It will make investing in other countries easier and hopefully encourage retail investors in particular to invest on European financial markets, which will eventually benefit the whole economy. Belgian minister of finance Double taxation Currently, where cross-border investments are concerned, many member states levy taxes on dividends (from equities and shares) and interests (on bonds) paid to investors who live abroad. At the same time, those investors have to pay income tax in their country of residence on the same income. Although treaties between member states aim to solve the issue of double taxation, in reality the procedures to claim withholding tax relief vary considerably from one member states to another, which results in relief or refund procedures being lengthy, costly and cumbersome. These procedures  can also be vulnerable to large-scale tax fraud. The withholding tax initiative will make tax relief procedures faster, simpler and, at the same time, safer. Common tax residence certificate The directive will introduce a common EU digital tax residence certificate (eTRC) that tax paying investors would be able to use in order to benefit from the fast-track procedures to obtain relief from withholding taxes. Member states will provide an automated process to issue digital tax residence certificates (eTRC) to a natural person or entity deemed resident in their jurisdiction for tax purposes. Fast-track procedures The directive allows member states to have two fast-track procedures complementing the existing standard refund procedure for withholding taxes. This will make relief and refund processes faster and more closely harmonised across the EU. Member states will have to use one or both of the following systems: a “relief-at-source” procedure where the relevant tax rate is applied at the time of payment of dividends or interest a “quick refund” system where the reimbursement of overpaid withholding tax is granted within a set deadline The Council agreed that member states must apply the fast-track procedures if they provide relief from excess withholding tax on dividends paid for publicly traded shares. Member states will have an option to maintain their current  procedures, and not apply Chapter III of the Directive, if: they provide a comprehensive relief-at-source system applicable to the excess withholding tax on dividends paid for publicly traded shares issued by a resident in their jurisdiction and their market capitalisation ratio is below a threshold of 1,5% (as reported by ESMA). Neverhteless, if this ratio is exceeded for four consecutive years, all rules foreseen by the Directive will become irrevocably applicable. In such cases member states will have five years to transpose the rules of the Directive into national law. These features take into account the size of the financial markets of Member States, while also recognising that some Member States maintain national systems that are adequate for their current market conditions. they provide relief from excess withholding tax on interest paid for publicly traded bonds The Council also introduced in the text additional circumstances in which member states may exclude, completely or partially, requests for withholding tax relief from the fast-track procedures, in order to perform further checks, with a view to preventing fraud. The Council added provisions to the text regarding indirect investments for cases where the investor does not invest directly insecurities but through a collective investment undertaking. These provisions ensure that legitimate investors such as certain collective investment undertakings or their investors have access to the fast-track procedures. Under the new rules, certified financial intermediaries requesting relief on behalf of a registered owner will need to carry out due diligence regarding the registered owner’s eligibility to benefit from tax relief. Standardised reporting for financial intermediaries The directive will set a standardised reporting obligation for financial intermediaries (like banks or investment platforms). This will make it easier for national tax authorities to detect potential tax fraud or abuse. Member states will establish national registers where large (and optionally smaller) financial intermediaries will have to register to be certified. In order to simplify this registration procedure, the Council agreed to create a European Certified Financial Intermediary Portal. This portal will act as a central dedicated website where the national registers will be accessible. Member states will retain the necessary discretion when it comes to registering and removing certified financial intermediaries in specific cases and to adopting measures that concern them. Once registered the financial intermediaries will need to report the necessary information to the relevant tax authorities so that the transaction can be traced. Member states will have the option of requesting more extensive reporting in relation to transactions with a view to detecting possible cases of tax abuse or fraud. The Council added the possibility of indirect reporting in addition to direct reporting. Where the reporting is direct, a certified financial intermediary is to report directly to the competent authority of the source member state. Where the reporting is indirect, the information is to be provided by each of the certified financial intermediaries along the securities payment chain. The Council agreed that penalties should be imposed by member states where obligations stemming from this directive are not complied with. Background and next steps The European Commission submitted a proposal for the FASTER directive on 19 June 2023. This proposal is subject to a special legislative procedure, where the Council acts as a sole legislator. Within the Council unanimity is required. The European Parliament was consulted and it delivered its opinion on 28 February 2024. However, due to the changes the Council made in the Directive during the negotiations, the European Parliament will be consulted again on the agreed text. The agreed text will go through a legal linguistic check and the directive will then need to be formally adopted by the Council before being published in the EU’s Official Journal and enter into force. Member states will have to transpose the directive into national legislation by 31 December 2028, but the national rules will have to become applicable from 1 January 2030. Council Directive on Faster and Safer Relief of Excess Withholding Taxes - General approach Taxation (background information)