Digital taxes: Europe warns that it will tax web giants with or without international agreement

Thursday June 18, Reuters reports that the European Union is putting pressure on the fact that it could impose taxes on digital giants like Google , Amazon and Facebook, even if no global agreement on digital taxes is found with the other countries by the end of this year 2020.

As a reminder, the United States announced last Wednesday that it was withdrawing from talks with European countries on the grounds that the negotiations were not progressing, causing the exasperation of certain stakeholders, including France. About 140 countries are participating in these negotiations orchestrated by the Organization for Economic Development Cooperation (OECD) in order to establish an international tax standard applicable to digital businesses.

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In principle, the parties should reach an agreement by the end of the year, but things get worse with the withdrawal of the United United…

The United States leaves the negotiating table

Bruno Le Maire, the French Minister of Finance, adsaid France, Britain, Italy and Spain responded together to the letter from US Treasury Secretary Steven Mnuchin announcing the withdrawal from the United States. The minister hammered on France Inter radio that:

This letter is a provocation. It is a provocation to all the partners of the OECD when we were a few inches from an agreement on the taxation of digital giants.

Nevertheless , the U.S. doesn’t seem to think so since it recently launched an investigation into digital taxes in Britain, Italy, Spain, and other countries to find out if U.S. businesses were being treated unfair.

Also read: Amazon does not want to pay the 250 million claimed by the European Commission

France refuses to let the digital giants get away with it too cheap

European Economic Commissioner Paolo Gentiloni said that " the European Commission wants a comprehensive solution to bring corporate taxation into the 21st century . However, he adds that "if this proves impossible this year, we have made it clear that we will present a new proposal at EU level .

An opinion that is confirmed with the statement of Bruno Le Maire who, according to Reuters, stressed that " France would impose its tax on digital services this year, whether Washington returns to negotiations or not and added that " no one can accept that the digital giants can make profits with their 450 millionEuropean customers and do not pay tax where they are .

Also read : Taxes customs, the cloth burns between France and the United States

A trade war could loom on the horizon…

France would take 3% of the revenue from digital services generated on its territory by companies whose turnover exceeds 25 million euros in France and 750 million euros worldwide. But it is not won since the United States threatens to impose taxes on champagne, handbags and other products if France applied this tax.

Similarly, Trump recently warned that he would impose taxes on European cars if the bloc did not lower taxes on American lobsterscains. In any case, if each party remains camped on its positions, could the situation degenerate into a (other) trade war?

Also read: GAFA tax, a new step forward