The application of the freedoms under the EC Treaty is sometimes referred to as “negative integration.” By contrast, “positive integration” refers to the European policies pursued to create the internal market. However, in the field of direct taxation, these have not materialized to any significant extent. This may well be due to the unanimity requirement governing the creation of directives and regulations, which are the European statutory instruments par excellence for achieving positive integration.

The directives most relevant to direct taxation are: 

  • Parent-Subsidiary Directive (dividend)
  • Merger Directive
  • Interest and Royalty Directive
  • Savings Directive
  • Mutual Assistance Directive (exchange of information)
  • Recovery Directive