European Court of Auditors Reviews the Single Market and Customs Programme

Executive Summary 

• The European Court of Auditors (ECA) broadly supports the creation of a unified Single Market and Customs Programme, recognising its potential EU added value, but raises concerns about governance, prioritisation, and budgetary flexibility. [eca.europa.eu]
• The ECA warns that excessive flexibility and weak prioritisation mechanisms could dilute the programme’s strategic focus and reduce accountability in spending on customs, taxation (including VAT), and anti‑fraud activities. [eca.europa.eu], [fasi.eu]
• Strong emphasis is placed on performance measurement, transparency, and control, with the ECA calling for clearer objectives, improved indicators, and reinforced safeguards for sound financial management. [eca.europa.eu]

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Detailed Article

1. Background and Legal Basis of the Opinion

In Opinion 08/2026, the European Court of Auditors (ECA) delivered its assessment of the European Commission’s proposal for a Regulation establishing the Single Market and Customs Programme (SMCP) for the period 2028–2034, adopted by the Commission on 3 September 2025 (COM(2025) 590 final). [eca.europa.eu]

The opinion was issued pursuant to Article 322(1) of the Treaty on the Functioning of the European Union (TFEU), following formal requests from:

• the Council of the European Union (21 October 2025), and
• the European Parliament (6 November 2025). [eca.europa.eu]

The ECA’s role is to support the legislative process by assessing the design, financial implementation, governance framework, and risk profile of the proposed programme.

2. Overall Assessment: Added Value with Structural Risks

The ECA acknowledges that merging several existing instruments into a single programme could generate EU added value, notably by:

• improving coordination between customs, taxation, anti‑fraud, and Single Market enforcement activities;
• fostering synergies between digital systems;
• simplifying access to EU funding compared with the current fragmented framework. [eca.europa.eu]

However, the Court stresses that these benefits are not automatic and depend heavily on robust governance, clear priorities, and effective performance management. Without these, the programme risks becoming a broad financing envelope lacking strategic direction. [eca.europa.eu], [fasi.eu]

3. Concerns on Objectives, Prioritisation, and Flexibility

A central critique in Opinion 08/2026 relates to the alignment between spending objectives and EU policy priorities.

The ECA highlights that:

• the proposed regulation lacks binding mechanisms to ensure that funding decisions are consistently aligned with EU‑wide strategic objectives;
• the extensive use of budgetary flexibility instruments grants the Commission wide discretion, potentially at the expense of predictability and transparency;
• prioritisation between competing policy areas (Single Market, customs, taxation, anti‑fraud) remains insufficiently defined. [eca.europa.eu], [fasi.eu]

According to the Court, this could weaken the programme’s capacity to respond effectively to systemic challenges such as VAT fraud, e‑commerce‑driven customs risks, and uneven enforcement across Member States.

4. Simplification: Ambition Versus Reality

While the Commission presents the programme as a major simplification initiative, the ECA adopts a more cautious view.

The Court notes that:

• merging several programmes does not automatically translate into simpler rules or procedures;
• a “single rulebook” may still mask significant operational complexity if management modes, funding mechanisms, and procurement rules remain heterogeneous;
• there is a risk that simplification at EU level could be offset by continued fragmentation at national level. [eca.europa.eu]

This observation is particularly relevant for tax and customs administrations, which already operate large‑scale digital systems with high interoperability and compliance requirements.

5. Governance, Performance, and Accountability

The ECA places strong emphasis on the need for a credible performance framework.

Key recommendations include:

• clearer and more measurable objectives and indicators;
• improved monitoring of outputs and outcomes, not just budget absorption;
• strengthened links between funding, performance, and policy impact;
• enhanced traceability of spending, especially for large IT systems supporting taxation and customs. [eca.europa.eu]

The Court also underlines the importance of safeguarding its audit mandate, given the increasing centralisation and digitalisation of EU‑level systems. [eca.europa.eu]

6. Implications for Taxation and VAT

From a VAT and indirect tax perspective, the opinion is particularly significant because the programme underpins:

• EU‑wide tax IT systems financed under Fiscalis;
• administrative cooperation tools crucial to combating cross‑border VAT fraud;
• digital infrastructure necessary for future initiatives such as ViDA. [eca.europa.eu]

The ECA’s concerns suggest that clear prioritisation, strong governance, and reliable performance metrics will be essential to ensure that VAT‑related investments deliver tangible improvements in compliance, fraud prevention, and revenue protection.

Conclusion

The European Court of Auditors’ Opinion 08/2026 offers qualified support for the Single Market and Customs Programme 2028–2034. While recognising its strategic importance and potential benefits, the Court issues a clear warning: without stronger governance, clearer priorities, and tighter performance controls, the programme risks falling short of its ambitions.

For tax authorities, businesses, and policymakers, the opinion highlights that digitalisation and integration alone are not sufficient—they must be accompanied by accountability, transparency, and effective oversight.

Source eur-lex.europa.eu

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