European Commission's Strategy for Strengthening Financial Stability and Competitiveness

This initiative focuses on harmonizing the EU's financial system through four key areas:

• empowering citizens in their savings decisions,
• stimulating investments and financing,
• integrating financial markets, and
• ensuring efficient supervision.

The strategy builds on progress made through the Capital Markets Union Action Plans and the Banking Union, addressing several tax-related challenges. One of the main measures is the FASTER Directive, which aims to reduce administrative burdens for cross-border investments. However, the Commission acknowledges ongoing issues caused by differences in national tax procedures and plans to support the exchange of best practices, enforce the free movement of capital, and issue non-binding recommendations to Member States.

Additionally, the Commission plans to develop a European blueprint for savings and investment accounts for retail investors, with tax treatment recommendations expected by the third quarter of 2025. The strategy also addresses the debt bias in tax laws, highlighting stalled progress in the DEBRA proposal, which sought to balance the preference for debt financing with the promotion of equity investments.

For more detailed information, you can read the E-News prepared by our colleagues at the KPMG EU Tax Centre.