What changed between the plenary report and the adopted text

45. Recalls that, as the Pillar Two rules are implemented, it is important to monitor new forms of harmful tax competition that may develop;

46. Commits to fighting aggressive tax planning, by both companies and individuals, for a fair European economy, taking into account the specific situation and interests of SMEs, and of low- and middle-income households; recognises the substantial revenue implications of aggressive tax planning, which tilts the playing field for economic actors, threatens to undermine tax morale and erodes the tax base of the Member States; urges the Commission and the Member States to improve cooperation between the Member States in addressing aggressive tax planning, particularly through enhanced information exchange, coordinated audits and improved enforcement; recalls its resolutions on the implementation of the EU requirements for exchange of tax information, on reforming the EU list of tax havens and on reforming the EU policy on harmful tax practices; highlights that increasing the complexity of tax regimes can create perverse incentives for aggressive tax planning and evasion, which may be opaque; calls for the Member States and the Commission to apply a risk-based and appropriate approach to fighting tax fraud and aggressive tax planning;

47. Stresses the importance of existing mechanisms under the Directive on Administrative Cooperation (DAC), the Anti-Tax Avoidance Directive (ATAD) and the Multilateral Competent Authority Agreement (MCAA), which have significantly improved transparency and cross-border cooperation between tax authorities, enabling a more effective response to aggressive tax planning; underlines the increasing administrative burden and compliance costs on tax administrations and taxpayers under the DAC and ATAD, and welcomes their review and simplification while still maintaining current standards;

48. Highlights the need to address inconsistencies between the ATAD and the OECD’s Pillar Two approach to ensure coherence and legal certainty across the EU, including considering the streamlining of options and exceptions granted to Member States; takes note of the Commission’s announcement that it will evaluate the ATAD in the light of Pillar Two and present a comprehensive report on the measures in Q3 2025, in accordance with the Pillar Two agreement; calls on the Commission to provide guidance to the Member States on the interpretation of the general anti-abuse rule laid down in the ATAD and calls for a revision to make the ATAD simpler to implement and increase its effectiveness;

49. Notes the role of the DAC in reducing tax evasion and avoidance, and aggressive tax planning, and in increasing transparency, while also highlighting the complexity and administrative burden, especially under DAC 6; stresses the need for the revision of DAC 6 and calls on the Commission to conduct an assessment of compliance costs under this Directive, as well as to strengthen guidance, enhance risk analysis, and leverage technology for better data collection so as to ensure effectiveness in promoting tax transparency, and prevent disproportionate costs and administrative burdens; states that this reassessment should consider shielding SMEs from unnecessary reporting obligations and provide more clarity regarding the benchmarks for reportable cross-border arrangements; suggests an assessment for a possible review of DAC 7 to consider whether the exchange of information can be reduced with the introduction of real-time reporting under the ViDA package;

50. Notes, in particular, the need to take advantage of the review process to address current overlapping rules, and to streamline and simplify the application of common rules and concepts; points out that standardisation of terms and concepts is crucial to simplify compliance, since various domestic interpretations may give rise to fragmentation and complexity;

51. Calls for enhanced collaboration between the EPPO and Eurofisc to strengthen intelligence-sharing, coordinated enforcement efforts and cross-border investigations in the fight against VAT fraud and other forms of tax evasion and avoidance; stresses the need for streamlined cooperation between these bodies to ensure a more effective and unified EU response to cross-border tax fraud, leveraging their respective mandates and expertise; urges the Commission and the Member States to facilitate this cooperation by improving data exchange mechanisms, ensuring adequate resourcing and fostering joint investigative efforts; stresses that further tax coordination between the Member States in tackling tax evasion and avoidance is necessary for facilitating cross-border economic activity; notes that the EU must ensure that all imported products are properly subject to adequate customs duties;

Cross-border taxation and labour mobility

52. Calls on the Commission to present a study and, if necessary, a package of measures on how to simplify tax rules and address tax fragmentation for cross-border workers and the self-employed, to boost competitiveness by deepening the internal market and to protect tax revenues by creating a level playing field; notes that divergent national tax systems create significant hurdles, administrative burdens, legal uncertainty and double taxation, hindering labour mobility and cross-border entrepreneurship;

53. Notes that the mobility of individuals across borders is increasing at an unprecedented rate and that such a high level of global mobility has a substantial impact on tax systems; stresses that such mobility and its impact on tax systems must be carefully considered in policymaking, while not discouraging mobility and employment opportunities in the EU; notes, in this respect, that Member States use tax incentives to foster labour mobility and cross-border entrepreneurship; stresses, however, that Member States must also prevent harmful tax practices attracting individual taxpayers and the distortion of competition by having clear caveats and safeguards;

54. Acknowledges the increasing cross-border mobility of highly skilled workers and other individuals driven by freedom of movement and preferential tax regimes in some of the Member States; underlines the importance of ensuring that tax policy in the internal market remains fair, transparent and compatible with the sustainability of public finances across the EU; reiterates its call for the Council to revise the mandate of the Code of Conduct Group on Business Taxation;

55. Recalls that tax implications arise from the risk of a taxable presence, or of permanent establishment, when cross-border workers engage in activities such as business trips or teleworking; notes that a safe harbour rule for teleworking coordinated between the Member States could provide tax certainty for employers and reduce administrative burdens, simplifying individual taxation;

Taxation and innovation

56. Highlights that innovation is a key driver of economic growth, global competitiveness, welfare and that, according to the OECD, tax incentives are a widely used and economically significant innovation-support policy instrument; takes the view that governments should ensure that research and development (R&D) tax incentive schemes provide value for money, through regular evaluation and the adoption of targeted incentives that drive investment and growth, and enhance EU competitiveness on the global stage, in line with the proposals of the Draghi report;

57. Calls on the Commission to conduct further studies on the cost-effectiveness of the different kinds of tax incentives for R&D and innovation, in enhancing EU competitiveness on the global stage, in line with the proposals of the Draghi report, ensuring that these incentives are well designed to achieve set policy objectives, without eroding tax revenues and contributing to the risk of tax avoidance; invites the Commission to explore different solutions and mechanisms in supporting R&D for start-ups, including, among other things, transferable tax credits, in a coordinated approach with the Member States and based on common criteria, to improve the accessibility and effectiveness of such measures; calls on the Commission to further assess the cross-border effects of such incentives in other Member States, including risks of tax avoidance; stresses the need for wider availability of tax incentives, including tax breaks, credits, accelerated depreciation and super deductions; in this respect, calls for the Commission to issue recommendations and properly integrate tax incentives, specifically related to R&D where appropriate, without exacerbating economic asymmetries in the EU; stresses that it would be prudent to align incentives for innovation and R&D with tailored incentives for investment; calls for strengthened cooperation and trust between the Member States, promoting a level playing field for e‑commerce, digital services and other rapidly growing sectors;

58. Stresses the importance of ensuring that tax incentives remain fully consistent with the current EU State aid framework; highlights the value of the EU State aid framework in preserving fair competition within the internal market and ensuring legal certainty and a level playing field for all Member States;