Status: 10/22/2021 8:30 p.m.
The United States has waived fines against five European countries in a dispute over national digital taxes. An important condition for the introduction of a global minimum tax was met.
The U.S. Treasury Department has announced deals with France, Great Britain, Italy, Austria and Spain in a dispute over the taxation of digital companies. The national digital taxes accepted in these countries are to be transformed into a new international tax system. In early October, 136 states agreed. The deal offers a corporate tax rate of at least 15 percent.
“This allows us to put an end to trade measures taken in response to digital taxes,” the U.S. Treasury Department said. The ministry spoke of a “practical solution” and announced further talks during the “constructive dialogue”. Digital taxes are specifically targeted at US Internet companies such as Facebook, Google and Amazon because, according to critics, companies pay the lowest taxes in the personal markets.
The United States threatened punitive countries as a result of the introduction of national digital taxes, but initially postponed their imposition in order to find an international solution.
States want to prevent tax competition
In July 2020, the United States initially threatened to impose a 25 percent penalty on French imports worth $ 1.3 billion. Washington has argued that a French digital tax is discriminating against American companies. Last June, US Trade Representative Catherine Toy announced penalties against Great Britain, Italy, Austria, Spain, India and Turkey. In this case, too, the charges did not come into effect, but were initially suspended for six months to find time for an international settlement.
Penalty charges against France, Great Britain, Italy, Austria and Spain are no longer on the table. The US Treasury Department did not provide any information about India or Turkey.
The new rules should come into force in 2023
The agreement for global minimum taxation for large corporations was reached within the framework of the Organization for Economic Co-operation and Development (OECD). The agreement is expected to take effect in 2023 and will prevent downward tax racing between individual countries.
U.S. Trade Representative Catherine Toy praised the compromise, but at the same time stressed: “We will continue to oppose the introduction of unilateral taxes on digital services.” According to the news agency “Europa Press”, the Minister of Finance of Spain, Maria Jess Montero, said that the agreement shows the international consensus of Spain.
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