ABBL’s position on the Proposal for a Faster and Safer Relief of Excess Withholding Taxes

More efficient withholding tax procedures? Yes, but not at the expense of financial sector players. As the ABBL, we are calling for greater simplification and harmonisation.

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 ABBL welcomes this proposal, which aims to simplify, digitise and to some extent harmonise withholding tax processes within the EU.

 The introduction of more efficient withholding tax procedures on cross-border securities income yielding genuine simplifications both for investors and paying agents is a long-standing priority of the ABBL.

However, we are concerned that the obligations vesting to financial intermediaries under the proposal at hand and related liabilities, as currently envisaged, may outweigh the benefits attached to the contemplated “fast track” procedures.

In this context, the ABBL calls for:

• more proportionality and simplification as regards the obligations contemplated for financial intermediaries
• a non-mandatory procedure
• greater harmonisation of underlying processes

As part of the European Commission’s “Have your say” process to seek the views of industry on its proposed text, we submitted this contribution.

We will follow closely this proposal to fully represent and advocate for the interests and priorities of our members. Stay tuned!