The BEFIT Directive Proposal: “Much Ado About Nothing” or a Concrete Opportunity for a Harmonized EU Approach to Corporate Taxation? – A Preliminary Assessment from an Italian Perspective

“In the middle of every difficulty lies opportunity”. This quotation from Albert Einstein aptly captures the current international tax landscape: the “difficulty” mirrors the uncertainty surrounding the global minimum tax, whereas the “opportunity” may lie in the BEFIT Proposal. Although a truly global approach to corporate taxation appears overly ambitious in today’s geopolitical climate, the BEFIT Directive represents a concrete EU step toward harmonized corporate income taxation, reducing the compliance burden for MNEs through a common tax base, cross-border loss aggregation and the removal of withholding taxes on income flows between BEFIT group members. However, “all that glitters is not gold”: stricter ownership thresholds and mandatory adjustments may restrict access and entail potential revenue losses. From an Italian perspective, this note focuses on the dividend and capital gains regimes, highlighting the risk of future tax revenue losses tied to existing divergences.