EU digital tax plans put on hold | Free press - economy

Brussels (dpa) - The EU Commission has put plans on hold to ask tech giants such as Google, Amazon, Apple and Facebook to pay more. However, the background is not that corporations should be spared.

The reason for the temporary stop of an EU digital tax are efforts to introduce a global minimum tax, said a Commission spokesman in Brussels on Monday. The digital levy should actually also co-finance the EU's corona aid.

US Treasury Secretary Janet Yellen last weekend called for an end to European digital taxes if the planned global tax reform is to be implemented. The finance ministers of the major industrial and trading countries agreed on a minimum tax of 15 percent on Saturday. At the working level, 131 countries around the world have already approved the plans. This is to prevent companies from relocating their headquarters to low-tax countries and the countries continue to lower their corporate taxes in competition with one another.

The final questions should be clarified by October this year. Then the heads of state of the G20 countries should agree. Finance Minister Olaf Scholz said he was “completely sure” that a decision would be successful there. The Commission spokesman stressed that one final joint effort was needed to complete the project.

Among other things, the large digital corporations are affected, and have often only paid little taxes to date. However, if a digital tax were to be levied in addition to the minimum tax, American tech companies in particular could be charged twice. You hope that the international agreement on a redistribution of taxation rights will make it possible to get rid of existing digital taxes, said Yellen on Saturday. Such taxes currently exist in France, Spain and Italy, for example.

The financial policy spokesman for the Greens in the European Parliament, Sven Giegold, also said that the transatlantic partnership means foregoing own European digital tax plans if the minimum tax is introduced as planned. The EPP Group's spokesman for economic policy, Markus Ferber, said: "The biggest tax law problem in the EU is tax deals that individual member states such as Luxembourg and the Netherlands are negotiating with multinational companies." An additional digital tax should not lead to the minimum tax failing.

In view of a conversation between the EU finance ministers and Yellen on Monday, Giegold called for a significantly higher minimum tax than recently decided. "Olaf Scholz should stand behind Janet Yellen and demand the tax rate of 21 percent for Europe as well." Before the US Congress votes on the tax rate, Europe should introduce the higher rate as a signal of support.