What changed between the draft committee report and the plenary report

MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

4 unchanged paragraphs

on the feasibility of a 28th tax regime and its potential to support EU competitiveness

(2025/2211(INI))

The European Parliament,

– having regard to Articles 4(2)(a), 5, 6(g), 50, 113, 114(1), 115, 116 and 225 of the Treaty on the Functioning of the European Union,

Added:– having regard to the Commission proposal of 18 March 2026 for a Regulation of the European Parliament and of the Council on the 28th regime corporate legal framework – ‘EU Inc.’ (COM(2026)0321),

Added:– having regard to its resolution of 20 January 2026 with recommendations to the Commission on the 28th Regime: a new legal framework for innovative companies1,

– having regard to the Commission communication of 21 October 2025 entitled ‘Commission work programme 2026 – Europe’s Independence Moment’ (COM(2025)0870),

– having regard to the Commission communication of 19 March 2025 entitled ‘Savings and Investments Union – A Strategy to Foster Citizens’ Wealth and Economic Competitiveness in the EU’ (COM(2025)0124),

– having regard to the Commission communication of 29 January 2025 entitled ‘A Competitiveness Compass for the EU’(COM(2025)0030),

Changed:– having regard to the Commission communication of 28 May 2025 entitled ‘The EU Startup and Scaleup Strategy – Choose Europe to start and scale’ (COM(2025)270COM(2025)0270),(COM(2025)0270),

– having regard to the report of 9 September 2024 by Mario Draghi entitled ‘The future of European competitiveness’ (Draghi report),

– having regard to the report of 17 April 2024 by Enrico Letta entitled ‘Much more than a market’,

Removed:– having regard to its resolution of 20 January 2026 with recommendations to the Commission on the 28th Regime: a new legal framework for innovative companies1,

– having regard to the Commission proposal of 12 September 2023 for a Council Directive on Business in Europe: Framework for Income Taxation (BEFIT) (COM(2023)0532),

Changed:– having regard to its resolutionposition of 13 November 2025 on the proposal for a Council directive on Business in Europe: Framework for Income Taxation (BEFIT)2,

Changed:– having regard to the Commission proposal of 12 September 2023 for a Council Directive on establishing a Head Office Tax system for micro, small and medium sized enterprises, and amending Directive 2011/16/EU (COM(2023)0528),

– having regard to its position of 10 April 2024 on the proposal for a Council directive establishing a Head Office Tax system for micro, small and medium sized enterprises, and amending Directive 2011/16/EU3,

Changed:– having regard to the Commission proposal of 25 October 2016 for a Council Directive on a Common Consolidated Corporate Tax Base (CCCTB) (COM(2016) 683COM(2016)0683),(COM(2016)0683),

Changed:– having regard to the Commission proposal of 25 October 2016 for a Council Directive on a Common Corporate Tax Base (COM(2016) 685COM(2016)0685),(COM(2016)0685),

Changed:– having regard to the Commission proposal of 11 May 2022 for a Council Directive on laying down rules on a debt-equity bias reduction allowance and on limiting the deductibility of interest for corporate income tax purposes (COM/2022/216)COM(2022)0216),(COM(2022)0216),

Added:– having regard to the Commission recommendation of 18 March 2026 on the definition of innovative enterprises, innovative startups and innovative scaleups,

Added:– having regard to Flash Eurobarometer 559 from February to April 2025 on Startups, scaleups and entrepreneurship,

Added:– having regard to the European Council conclusions of 19 March 2026,

– having regard to Rule 55 of its Rules of Procedure,

Changed:– having regard to the report of the Committee on Economic and Monetary Affairs (A10-0000/2026),(A10-0167/2026),

Change 1

Changed:A. whereas the EU, as the largest integrated market in the world, with more than 450 million consumers, is losing its economic competitive edge4;edge4 owing to the confluence of structural weaknesses, the increasingly intense global competition to attract capital, businesses and talent, and a complex and fragmented regulatory framework;

Change 2

Removed:B. whereas internal trade barriers in the EU’s single market are estimated to be the equivalent of a tariff rate of 44 % for goods and 110 % for services5;

Added:B. whereas economic competitiveness – at the core of most relevant EU policies and of urgent political priority, indicated by internal market integration, productivity growth, substantial public and private investment, and the digital and green transitions – may bolster the EU’s prosperity by creating high-quality jobs, sustain our economic and social model, and consequently invigorate the welfare of our people and societies;

Removed:C. whereas enterprises across the EU, specifically small and medium-sized enterprises (SMEs), start-ups and scale-ups, and their innovative potential are structurally stifled by the persistent fragmentation of regulatory frameworks between Member States; whereas regulatory diversity and the associated costs of navigating unfamiliar environments hinder the pan-European financing and scaling up of companies, and there is an urgent need to address this competitiveness gap6;

Added:C. whereas internal trade barriers in the EU’s single market are estimated to be the equivalent of a tariff rate of 44 % for goods and 110 % for services5, which continue to represent a significant burden for business growth and investment in the EU and highlight the cost of regulatory fragmentation, and the need to move towards a more integrated, simplified and ambitious framework;

Removed:D. whereas for SMEs, start-ups and scale-ups the difficulties in understanding the different business environments in the EU, including due to language barriers, access to information or rules and requirements, taxation issues and business authorisation, represent the most significant barriers to their cross-border operations and to scaling up within the EU;

Added:D. whereas the capacity to deliver greater harmonisation in the field of taxation, and of the regulatory framework, remain restricted by the unanimity requirement applicable to this policy area; whereas further harmonisation and the deepening of the internal market are instrumental in boosting EU competitiveness and delivering reductions in the administrative burden and cost of cross-border economic activity; whereas diminishing loopholes for aggressive tax planning and other tax avoidance practices should be instrumental in boosting EU competitiveness as envisaged in the ‘One Europe, One Market’ agenda;

Removed:E. whereas a significant portion of fast-growing, innovative companies is leaving the EU to scale-up elsewhere, due to better access to large markets, a supportive business environment, better access to venture capital, heightened availability and mobility of talented and skilled workers, an unfragmented regulatory framework and a less complex tax environment, which would be conducive to cross-border investment7;

Added:E. whereas boosting the EU’s competitiveness is closely connected to consolidating its strategic autonomy and being able to reduce external economic dependencies in strategic and critical sectors;

Removed:F. whereas the potential benefits of an optional pan-European business regime, vastly simplifying the whole process of future expansion to new markets, both within and outside of the EU, lie in enhanced legal certainty, lower compliance costs and simplified regulatory procedures; whereas it is necessary to ensure clarity and legal certainty for European and foreign investors by using simpler and better harmonised rules that enable them to invest cross-border;

Added:F. whereas enterprises in the EU, specifically small and medium-sized enterprises (SMEs), start-ups and scale-ups, and their innovative potential are structurally stifled by the persistent fragmentation of regulatory frameworks between Member States; whereas regulatory and tax diversity and the associated costs of navigating unfamiliar, distinct and often incompatible national environments hinder the pan-European financing and scaling up of companies, and whereas there is an urgent need to address this competitiveness gap6; whereas a favourable, predictable and proportionate regulatory environment is essential to enable companies to invest, grow and compete globally; whereas the EU should strengthen its commitment to entrepreneurial freedom and the removal of barriers; whereas by providing a harmonised framework, the 28th regime would facilitate EU SMEs access to capital, contribute to reducing economic and territorial disparities in the EU, ensure balanced access and development conditions across different regions, and make it easier for investors to provide funding to companies located in another Member State;

Removed:G. whereas to address these policies and political goals, the EU and its Member States must act boldly and ambitiously;

Added:G. whereas the overall administrative burden reduction of the proposed regulation establishing the 28th regime is estimated at between EUR 328 million and 440 million over a period of 10 years7;

Added:H. whereas for SMEs, small mid-caps, start-ups and scale-ups, the difficulties in understanding the different business environments in the EU – including owing to language barriers, lack of access to information or rules and requirements, taxation issues and business authorisation – represent the most significant barriers to their cross-border operations and to scaling up within the EU; whereas taxation, particularly issues relating to Value Added Tax (VAT), permitting and authorisations make up the main obstacles to their scaling up in other EU countries8;

Added:I. whereas as of 2025, Europe only had 331 unicorns compared to 1 963 in the United States and whereas between 2008 and 2021, close to 30 % of European unicorns relocated their headquarters outside the EU; whereas a large proportion of companies are leaving the EU to find the necessary capital in other jurisdictions; whereas this is due to better access to large markets, a supportive business environment, better access to venture capital, heightened availability and mobility of talented and skilled workers, an unfragmented regulatory framework and a less complex tax environment, and the wider availability of employee ownership schemes, which would be conducive to cross-border investment and to attracting and retaining economic and industrial activity within their economies9;

Added:J. whereas, as mentioned in the Draghi report, for innovative companies, ‘a voluntary 28th company rulebook harmonising legislation concerning corporate law, insolvency, as well as a few key aspects of taxation, to be made progressively more ambitious, could be explored under enhanced cooperation by willing Member States’10;

Added:K. whereas, as stated in the Letta report, tax is another area where complexity is a major barrier to cross-border trade and investment, and regulatory fragmentation may turn the single market into an obstacle for SMEs; whereas the report identifies the 28th regime as a key tool to enable them to fully benefit from the single market11;

Added:L. whereas the tax dimension of the 28th regime should respect the competence framework provided for by the Treaties and be designed to support the full life cycle of companies; whereas the Draghi report shows that the EU lacks venture capital investment at each development stage of start-ups (seed, early stage and late stage) as a result of a lack of scaling possibilities;

Added:M. whereas the potential benefits of an optional pan-European business regime, vastly simplifying the whole process of future expansion to new markets, both within and outside of the EU, lie in enhanced legal certainty, lower compliance costs and simplified regulatory and tax procedures, and a level playing field with competing jurisdictions outside the EU; whereas it is necessary to ensure clarity and legal certainty for European and foreign investors by providing simpler and better harmonised rules, including in the area of taxation, that enable them to invest cross-border with confidence;

Added:N. whereas to address these policies and political goals, the EU and its Member States must act using a coordinated, ambitious and results-oriented approach;

Added:O. whereas completing the Savings and Investments Union is essential to mobilise private capital in the EU and channel it efficiently into the economy, in particular towards SMEs, start-ups and scale-ups; whereas a deeper, more integrated and more accessible capital market would improve access to finance and encourage long-term investment; whereas further integration of European financial markets is key to strengthening the EU’s competitiveness, preventing the flight of companies to other jurisdictions and ensuring that European savings finance growth and innovation within the single market;

Added:P. whereas the additional modules, stemming from the 28th regime, may play a role in supporting the cross-border development of long-term savings and pension products; whereas, in the context of taxation, such regimes should interact coherently with national tax frameworks;

General principles

Change 3

Removed:1. Welcomes the Commission’s legislative proposal for a 28th regime for companies;

Added:1. Welcomes the Commission’s legislative proposal on a 28th regime (‘EU Inc.’) for companies; recognises its potential systemic impact on the functioning of the single market and the overall competitiveness of the EU’s economy; underlines, however, that the proposal on the 28th regime must not constitute a replacement for any further legislative efforts to reduce fragmentation and disparities between the regulatory frameworks of Member States;

Removed:2. Reiterates that the 28th regime must be ambitious and comprehensive in its substance, including on taxation aspects, in order to allow SMEs and innovative companies to scale-up and operate seamlessly within the EU’s single market;

Added:2. Highlights its adoption of a resolution with recommendations to the Commission on the 28th regime: a new legal framework for innovative companies;

Removed:3. Stresses that the 28th regime must embrace all relevant aspects of corporate, insolvency, labour and tax law, must cover the whole life cycle of companies, and must be continuously evaluated against international benchmarks; considers that its potential benefits are substantial in terms of lower compliance costs, simplified regulatory procedures, enhanced legal certainty or smoother access to cross-border markets;

Added:3. Welcomes the adoption of the ‘One Europe, One Market’ agenda to unlock the potential of the single market; takes note of the European Council’s call for the adoption of a 28th regime for company law; notes the European Council’s lack of references to targeted tax policy harmonisation under this agenda, particularly given that SMEs selected tax and VAT fragmentation as the most prevalent barrier to scaling up;

Removed:4. Notes that for a 28th tax regime to be attainable under the existing Treaty framework, it may take the form of enhanced cooperation, either within an opt-in or opt-out structure of the relevant directive in the field of taxation, or by including a ‘sunset clause’, or through a combination of these approaches;

Added:4. Stresses the fact that taxation is in most cases an exclusive competence of the Member States, yet there is – particularly in terms of procedures – a space for further simplification or targeted harmonisation tackling different compliance regimes, complex and fragmented corporate tax treatment, reporting obligations and administrative barriers in the treatment of cross-border investment; highlights the positive contribution of previous EU legislative initiatives on taxation, particularly in tackling tax evasion, avoidance and fraud, which are complementary to national legal frameworks;

Removed:5. Stresses that the 28th regime must effectively reduce compliance complexity for participating companies and must not create a parallel rule book that is layered on top of national legal systems;

Added:5. Calls for the 28th regime initiative to be ambitious in its substance, including on taxation aspects, all the while fully respecting the Treaties, in order to allow SMEs, small mid-caps and innovative companies to scale up and operate seamlessly without transnational barriers across the EU’s single market;

Removed:6. Emphasises that in order to avoid further complexity, the provisions of the 28th regime should be in line with any other major proposals of the Commission in the field of taxation;