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EU Proposes Uniform R&D Tax Deductions to Strengthen Business Competitiveness

The Commission says the move will align tax treatment across member states and must secure unanimous approval by all 27 governments before it can take effect.

Overview

  • The European Commission presented the package on Wednesday, June 24, 2026, proposing a harmonized tax rule that would let companies deduct up to 100% of spending on tangible assets used for R&D either immediately or over four years.
  • Commissioner Wopke Hoekstra said loans taken to buy equipment, hire staff, or fund innovation would qualify for full interest deductibility under the proposal.
  • The plan also raises reporting thresholds for online sales platforms so they only report individual item sales above €3,000, reducing paperwork for small and second‑hand sellers.
  • Brussels estimates the R&D deduction would lift EU GDP by about 0.2% and save companies roughly €265 million a year, with the wider simplification package potentially cutting business costs by up to €8 billion annually.
  • Adoption is uncertain because the measures require unanimous consent and changes to national laws, and the proposal includes safeguards such as a three‑year minimum use rule for equipment and exclusions for land and residential property.