EU Commission proposes strengthened cooperation to combat tax fraud

On 14^th November 2025, the European Commission proposed a plan to strengthen cooperation among the European Public Prosecutor’s Office (EPPO), the European Anti-Fraud Office (OLAF) and Member States. This is part of a broader effort to combat VAT fraud.

The proposal establishes a legal framework for the sharing of information. It grants the EU bodies immediate access to VAT data, which is expected to enhance the detection of cross-border tax evasion schemes – a step that has been long requested by both agencies and highlighted repeatedly in audit and parliamentary reports.

With the introduction of real-time reporting as part of the VAT in the Digital Age (VIDA) package, authorities will have access to information needed to identify suspicious activity and step up the fight against VAT fraud, particularly carousel fraud.

Carousel or Missing Trader Intra-Community (MTIC) fraud costs EU taxpayers billions each year, estimated between €12.5 billion and €32.8 billion annually. And this forms a significant part of the overall VAT gapThe difference between the amount of VAT revenue due to a tax authority and the amount actually collected, which was estimated to be €89.3 billion for the EU in 2022.

The Commission argues that improved data sharing and coordinated digital tools are essential to close long standing loopholes exploited by criminal organisations.

Furthermore, the proposal creates direct and efficient communication channels between EPPO, OLAF and Eurofisc (the EU network of national officials responsible for tackling VAT fraud). This is intended to strengthen their capacity to coordinate cross-border investigations and exchange crucial information in real time.

Next steps

The plan will be submitted to the Council for agreement and to the European Parliament and Economic and Social Committee for consultation.

Once adopted and published, the changes will take effect and trigger the implementation phase across the EU.