-In this
position paper the
ESBG criticises that the directive does not succeed to address the factors that currently provoke large capital outflows and jeopardises the objective to keep the administrative burden to a minimum.
The ESBG mentions the following points of criticism:
The problem of large capital outflows can only be addressed when third and associated countries will adopt similar taxation measures. It would be counterproductive to lay down standards for taxation on EU level, only.
Although the decision to introduce a system of exchange of information has been welcomed i.e. by the ESBG’s member from the UK, quite a few ESBG members favor a smooth transition to a common withholding tax with final effect at a moderate tax rate.
If a harmonization of the measurement for interest payments is not achieved, the credit institutions would have to face enormous administrative burdens. The resulting costs will have a negative competitive effect on the European financial markets.
More simplicity in the concept of taxation and a moderate tax burden is needed, in order to create incentives for the beneficial owner, thereby increasing his willingness to pay tax.
A further harmonization of the definition of “interest payment” and the basis of its measurement on an international level is necessary (Art. 6).
The standards allowing the paying agent to identify the beneficial owner and his residence should not go beyond the ‘know your customer rules’ (Art. 3).
© European Savings Banks Group
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