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The Council of the EU questions Washington’s demands on countries to reduce national “unilateral” technology taxes as soon as a global tax on multinational companies has been agreed. This is evident from a document received from POLITICO.
The pushback takes the form of an internal council document prepared by the Portuguese EU Presidency for a technical meeting of tax officials on Friday.
“It is important that the definition of unilateral measures does not hinder the ability of the EU and the Member States to define their tax policies and implement such taxes,” the five-page document read on May 17.
US President Joe Biden last month turned negotiations on a global digital tax in the Organization for Economic Cooperation and Development on its head. His government proposed simplifying the tax by developing a levy targeting the 100 largest multinationals in the world.
As part of its new pitch, Washington said it would define what it sees as “relevant unilateral measures” or national taxes targeting US businesses and force countries to scrap them.
The OECD accepted the US pitch. However, European policymakers are questioning whether the new levy would ensure that all digital giants pay their fair share of the fees. The European Commission is also preparing a digital EU levy this summer to repay the debt it will raise for the bloc’s € 750 billion recovery fund.
“The definition of a” unilateral measure “agreed in the OECD should not preclude the EU from having the right to levy a” digital levy “,” says the document.