On June 24, 2026, the European Commission presented proposals for a new Tax Omnibus Directive and a recast of the Directive on Administrative Cooperation (DAC). The proposed measures are intended to change existing EU tax directives and information-exchange frameworks while still maintaining key anti-abuse protections and transparency standards.

Key Proposed Tax Changes

The Tax Omnibus proposal would introduce significant amendments to the Interest and Royalty Directive, the Parent-Subsidiary Directive, the Anti-Tax Avoidance Directive, the Tax Merger Directive, and the Directive on Faster and Safer Relief of Excess Withholding Taxes

The DAC recast consolidates Council Directive 2011/16/EU on administrative cooperation in the field of taxation into a single piece of legislation. It incorporates all previous amendments and expansions of the Directive, including DAC2 on the Common Reporting Standard, DAC3 on the exchange of information regarding tax rulings, DAC4 on country-by-country reporting, DAC5 on access to beneficial ownership information, DAC6 on mandatory disclosure rules for cross-border arrangements, DAC7 on digital platform reporting and joint audits, DAC8 on crypto-asset reporting and CRS amendments, and DAC9 on administrative cooperation related to Pillar Two implementation.

The main reason for the DAC recast is to simplify and modernize the overall DAC framework by bringing the various amendments into a single coherent legislative structure. By doing so, the European Commission aims to reduce duplication, improve consistency across the different reporting regimes, and ease certain administrative and compliance burdens for both taxable persons and Tax Authorities.

In addition to redrafting the DAC, the European Commission also proposed excluding reportable cross-border arrangements from DAC6 reporting requirements when they involve entities that are part of groups effectively subject to the Pillar Two Global Anti-Base Erosion (GloBE) rules. Additionally, the current DAC7 sales-of-goods threshold would be simplified by removing the 30-activity limit and increasing the monetary threshold from EUR 2,000 to EUR 3,000. 

The proposal also introduces a single notification, submitted by the filing constituent entity or reporting entity using a harmonized template. This is intended to reduce duplication between DAC4 country-by-country reporting and DAC9 central filing of top-up tax information return notifications.

Notably, both proposals require unanimous approval from all EU countries before they can be adopted. Negotiations among EU Finance Ministers at the Council level are expected to begin in the coming weeks, as both initiatives are treated as priority projects during 2026 and 2027.

Conclusion

If adopted, the Tax Omnibus Directive and the DAC recast would represent a significant development in the EU tax landscape. Despite the primary objective of simplifying tax rules and reducing administrative and compliance burdens, the proposals' introduction of several new measures, procedures, and compliance requirements would affect financing arrangements, profit repatriation strategies, holding company structures, and tax reporting obligations for businesses and investors. The DAC recast would be especially important for multinational enterprise groups, intermediaries, and digital platform operators.