The Commission has published its second evaluation of Council Directive 2011/16/EU on administrative cooperation in the field of taxation (DAC). The DAC is a key legislative instrument that fosters tax transparency and cooperation between tax authorities across the EU. The second evaluation of the DAC covers the period from 2018 to 2023 and concludes that the Directive provides a robust and well-functioning legal framework that actively supports Member States in their fight against tax fraud, evasion and avoidance.
A robust, flexible and effective framework for tax cooperation
The evaluation confirms the effectiveness of DAC in facilitating administrative cooperation between Member States. It also concludes that DAC is an agile instrument that evolves to emerging needs. In this respect, DAC substantially increased the volume of information exchanged between Member States, by including new areas where more tax transparency was needed. The information exchanged is increasingly used by tax administrations for risk assessments, control purposes and to foster voluntary tax compliance. This, in turn, helps to ensure fair taxation in the EU.
Significant financial returns
One of the most significant conclusions of the evaluation is the cost benefits of the DAC. While the administrative burden of reporting obligations may appear substantial, the evaluation found that the benefits far outweigh the costs. DAC has played a crucial role in helping Member States to increase revenue collection, thereby closing the tax gap in the EU more efficiently. The total tax benefits are estimated at approximately EUR 6.8 billion annually, representing a substantial contribution to the Member States’ tax revenue.
Ensuring simplification, a more coherent application and further improvements
The evaluation has identified some areas for improvements, including the need to consolidate and simplify the DAC and to ensure a more consistent application of the Directive across all Member States. Further efforts are required to ensure a more robust penalty framework in all Member States, to facilitate the automatic reconciliation of DAC data with national data and to better assess and increase transparency on the benefits generated by the DAC.
Background
The DAC is designed to enhance cooperation among tax authorities within the EU. It enables the exchange of crucial tax-related information between Member States, making it more difficult for individuals and companies to evade and avoid taxes. The primary goal of DAC is to promote transparency and ensure that all taxpayers contribute their fair share. The DAC has been continually updated to address new challenges, ensuring that the EU remains at the forefront of international efforts to combat tax fraud, evasion and avoidance and promote tax fairness.
Related documents
Details
- Publication date
- 19 November 2025
- Author
- Directorate-General for Taxation and Customs Union