Improving tax procedures for cross-border trading of securities could raise European GDP by more than 37 billion Euro over a ten-year period. This is the key finding of a study jointly carried out by the JRC’s Institute for the Protection and Security of the Citizen (IPSC) and the Commission’s Directorate General Internal Market and Services which analyses the costs and benefits of the proposals made by the EU Clearing and Settlement Fiscal Compliance Experts Group (FISCO) for improving and simplifying withholding tax relief procedures.
Based on the FISCO proposals and backed up by the economic impact study, the European Commission adopted on 19 October 2009 a Recommendation that outlines how EU Member States could make it easier for investors resident in EU Member States to claim withholding tax relief on dividends, interest and other securities income received from other Member States. The Recommendation also suggests measures to eliminate the tax barriers that financial institutions face in their securities investment activities while at the same time protecting tax revenues against errors or fraud.