EU Gateway: Overview Defensive Tax Measures in EU27

27/08/24

Most EU Member States are currently using the EU list of non-cooperative jurisdictions to apply certain tax measures in their laws. These measures include non-deductibility of costs incurred in a listed jurisdiction, controlled foreign company rules, withholding tax measures, and limitation of participation exemption on shareholder dividends.

The EU Gateway team of PwC the Netherlands has prepared an overview of these measures in each EU Member State. The overview shows a variety of approaches by the EU Member States in applying the EU list in their tax measures. This overview is an invaluable resource for understanding the tax measures across the EU. It provides clarity and insight into how different EU Member States are implementing these measures, helping businesses stay compliant and informed.

The overview is available here.

What does it mean for your organisation?

The presence of an entity in an EU-listed jurisdiction, or the execution of any inbound or outbound transaction involving such jurisdictions, may trigger the application of defensive tax measures in most EU Member States. Companies planning to set up within the EU or engaging in commerce among EU Member States must recognise the potential risks when dealing with entities or transactions associated with EU-listed jurisdictions.

Moreover, considering the EU list is revised biannually, the inclusion of a jurisdiction can have direct implications for specific EU Member States in relation to their defensive tax measures. Monitoring these measures, whether already in effect or forthcoming, in each EU Member State, as well as keeping up with policy developments concerning the EU list, is essential.

PwC’s expansive network across Europe makes it possible for the EU Gateway team to provide you valuable assistance in these areas. At PwC Netherlands, we understand these challenges. That's why we've launched EU Gateway, dedicated to providing coordinated support for non-EU clients navigating the complex EU tax and legal landscape. Our extensive network of tax and legal specialists offers tailored assistance, ensuring you understand and comply with intricate EU regulations effectively.

You can find more information on our dedicated EU Gateway website.

The EU list

The EU list of non-cooperative jurisdictions (the EU list) is a tool of the European Union to promote fair tax competition and address harmful tax practices. The EU list includes non-EU jurisdictions that either have not engaged in a constructive dialogue with the EU on tax governance or have failed to deliver on their commitments to implement the necessary reforms. To be considered cooperative for tax purposes, jurisdictions are screened by the EU Code of Conduct Group (Business Taxation) on the following criteria: