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Delay in the EU digital levy – POLITICO

The planned EU digital levy threatens to bring the international talks to the revision of the global corporate tax regulations to failure and should be postponed, so the American Joe Biden in a position paper received by POLITICO.

Washington sent the “nonpaper” to EU diplomats a few days ago ahead of the global tax negotiations this week at the Organization for Economic Co-operation and Development, two officials said. The US newspaper was first reported by AFP on Wednesday.

The OECD talks aim to reach a political agreement on the taxation of the 100 largest companies in the world and to set a global minimum tax rate of 15 percent for companies. The G20 countries will conclude the agreement in a few weeks. Washington will only approve the agreement, however, if other countries withdraw their national technology taxes – including EU initiatives.

“The EU digital tax, although different from previous taxes on digital services, threatens the work being done in the context of the OECD / G20 process,” the US document says. “We urge you to work with the European Council and the European Commission to delay the publication of the EU proposal on digital delivery.”

The Commission intends to propose the initiative in mid-July in order to repay the money it will raise to finance the EU’s € 750 billion recovery fund. Commission officials have tried to reassure Washington that the “soft” levy will not result in double taxation or discriminate against US technology companies.

“We welcome the repeated public statements indicating that the EU intends to ensure that its digital filing complements a multilateral consensus solution,” the US paper continued. “Such complementarity is only possible if the OECD / G20 Inclusive Framework consensus is reached before the EU proposes its levy.”

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