Ireland’s Presidency of the Council of the European Union

1. Ní neart go cur le chéile

On 1 July 2026, Ireland assumed the Presidency of the Council of the European Union for the eighth time (last held in 2013). Ireland’s six month tenure runs until 31 December 2026, under the motto “ní neart go cur le chéile” which translates to “strength with unity”.

The Irish Presidency programme, published on 10 June 2026, is structured around three core themes:

1. Competitiveness: fostering prosperity and wellbeing by advancing the “One Europe, One Market Roadmap” - a joint initiative of the European Parliament, the Council of the European Union and the European Commission in April 2026 to strengthen the Single Market, remove barriers to trade and investment, and enhance Europe's competitiveness.

2. Values: upholding the EU’s foundational values per Article 2 of the Treaty on European Union; and

3. Security: protecting citizens in the context of Russia’s war in Ukraine and other emerging threats.

A further overarching priority is facilitating agreement on the EU’s Multiannual Financial Framework 2028–2034 - the EU’s seven-year long-term budget that sets spending priorities and funding limits across key policy areas.

2. Tax Policy Within the Competitiveness Pillar

The competitiveness pillar places the EU’s simplification agenda front and centre. In the General Affairs Council, Ireland has committed to delivering “swift progress on the simplification agenda.”

For Ireland, an EU tax policy that is competitive, predictable, and simple to administer is of particular national interest. In a post-Pillar Two environment where headline corporate tax rates are less of a differentiator, certainty, simplicity, and efficient administration become sources of competitive advantage.

3. The Tax Simplification Package

The European Commission adopted its Tax Simplification Package on 24 June 2026, comprising two legislative proposals. The package is expected to save EU businesses approximately €8 billion annually (including €3.3 billion in administrative costs), bringing total simplification savings to over €18 billion, almost half the mandate’s goal.

a. The Direct Taxation Omnibus

This proposal amends six major direct tax directives to reduce compliance burdens, enhance legal certainty, and remove barriers to cross-border activity, namely the:

• Interest and Royalties Directive (“IRD”);
• Merger Directive;
• Parent-Subsidiary Directive (“PSD”);
• Anti-Tax Avoidance Directive (“ATAD”);
• Tax Dispute Resolution Mechanisms Directive (“TDRD”); and
• FASTER Directive.

The European Commission stated that there would be no compromise on the existing level of protection against tax avoidance, but that the proposal delivers a more harmonised system, with fewer implementation options. If adopted, provisions will apply from 1 January 2029. Notably, simplification of Pillar Two itself is not part of this package.

b. The Directive on Administrative Cooperation (“DAC”) Recast

This proposal consolidates the DAC and its eight successive amendments (DAC2 to DAC9) into a single codified instrument. Key measures include:

• Groups subject to the 15% Pillar Two minimum tax will be exempt from DAC6 mandatory disclosure;
• Low value cross-border arrangement reporting requirements will be removed, cutting volumes by an estimated 35%;
• DAC7 will remove the existing 30 transaction activity threshold and increase the monetary threshold from €2,000 to €3,000, thereby exempting over 10 million private sellers of second-hand goods from reporting;
• There will be a single notification for Country-by-Country Reporting and centralised Pillar Two top-up tax filings;
• The development of DAC6 Hallmark D2 (economic substance) through a Council of the European Union implementing act, effectively incorporating the substance test originally proposed under the abandoned “Unshell” Directive; and
• A new taxpayer identification and verification tool will be implemented, including a mandatory exchange of all categories of income and capital.

Combined, the DAC Recast measures are projected to reduce compliance costs by over €1 billion annually.

4. Ireland’s role during the Presidency

Both proposals follow the standard EU tax legislative procedure under Article 115 of the Treaty on the Functioning of the EU of consultation of the European Parliament and adoption by unanimity in the Council of the European Union. Ireland will chair the Economic and Financial Affairs Council (“ECOFIN”) during its Presidency term and will be responsible for brokering compromises and driving the legislative timetable.

The Irish Presidency and the European Commission have signalled an ambition to agree the DAC Recast by the end of 2026, within Ireland’s term. The Direct Taxation Omnibus, which carries greater revenue and harmonisation implications, is expected to progress more slowly and prove more contested among Member States during negotiations in the Council of the European Union.

5. Implications for Irish Tax Practitioners and Businesses

• No immediate change: Current obligations under the PSD, IRD, ATAD, DAC6, and DAC7 regimes remain in force until a final Directive is adopted and transposed into Irish law.
• DAC6/DAC7 relief on the horizon: If the DAC Recast is agreed during Ireland’s Presidency, Irish intermediaries and taxpayers can expect significant reporting relief, particularly regarding Pillar Two subject groups and platform operators.
• Direct Taxation Omnibus: The Omnibus's stated objective of reducing implementation options across the ATAD, PSD and IRD may limit Ireland's current flexibility in transposition and should be reviewed against existing Irish legislation.
• Dispute resolution: Amendments to the TDRD could affect taxpayer access to mutual agreement procedures and arbitration for cross-border disputes.
• Domestic opportunity: Ireland may leverage its Presidency to advance domestic simplification of tax administration (e.g. corporation tax and VAT filing) alongside the EU level agenda.

Ireland’s Presidency places it at the centre of the EU’s most significant tax simplification initiative in recent years. Tax practitioners should monitor ECOFIN’s progress closely, particularly on the DAC Recast, and begin assessing the potential impact of both proposals on existing reporting obligations and cross-border arrangements.