Global Daily Tax News, France, Germany, Italy Told To Fix Intra-Company Dividends Tax Rules, (Jul 9, 2026)

The European Commission has launched infringement proceedings against Germany, France, and Italy for failing to bring their legislation on the taxation of dividends received from subsidiaries in other member states into line with the Parent-Subsidiary Directive.

Germany, France, and Italy tax dividends received by a parent company from subsidiaries resident in other member states multiple times beyond what is allowed in the Directive, the Commission said. It considers this has a negative bearing on competitiveness and investment for mid-sized and larger companies operating across the Single Market.

The start of infringement proceedings is part of wider enforcement efforts being undertaken by the Commission to remove barriers in the Single Market in 11 focus areas, as announced in the Communication "A simpler, clearer, and better enforced EU Rulebook".

The Commission has sent a letter of formal notice to each member state. They have two months to respond to the letter or the Commission may decide to escalate proceedings by issuing a reasoned opinion.