The European Commission has presented a comprehensive tax simplification package that includes a new Direct Taxation Omnibus Directive and a recast of the Directive on Administrative Cooperation (DAC). The Omnibus aims to cut compliance costs, enhance legal certainty, and remove cross‑border tax barriers by eliminating withholding taxes on dividends, interest and royalties, simplifying interest‑limitation rules, and unifying controlled foreign company rules. It also introduces a common standard for R&D investment treatment, expected to boost EU GDP by 0.2 % annually. The DAC recast consolidates nine directives into a single instrument, streamlines reporting for multinational groups, and removes low‑value reporting thresholds, yielding an estimated €1.3 billion in annual savings. Together, the measures target a 25 % reduction in administrative burdens, translating to roughly €37.5 billion in cost savings by 2029 while maintaining anti‑avoidance safeguards.
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