UK chancellor announces 2% ‘digital services tax’ on tech giants’ revenues starting in April 2020

Minimalist · Jun 3, 2020

France Hits Back At US Trade Threat Over Digital Tax

France has issued a public rebuke to the United States over its trade threats to those countries introducing a tax on technology giants – the so called digital or tech tax.

French Finance Minister Bruno Le Maire criticised US threats of trade sanctions over digital service taxes, which he said clashed with its calls for G7 unity on other issues, Reuters reported.
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https://www.silicon.co.uk/e-marketing/ecommerce/france-hits-back-at-us-trade-threat-345494

guest · Jun 4, 2020

Spain's Lower House to Draft 3% Digital Tax on Internet Giants
June 4, 2020
https://www.nytimes.com/reuters/2020/06/04/technology/04reuters-spain-tax-internet.html

Spain's lower house voted on Thursday to begin drafting a 3% tax on revenues of internet giants, the latest of such moves by U.S. trading partners that has spurred a U.S. investigation and could lead to punitive tariffs.

The tax would apply to revenues booked locally by tech firms such as Facebook, Alphabet Inc's Google, Apple and Amazon and would generate about 1 billion euros ($1.12 billion) in annual revenues for the state.
The U.S. Trade Representative's office said on Tuesday it was launching a "Section 301" investigation into digital services taxes that have been adopted or are being considered by Spain and other U.S. trade partners.

"We are prepared to take all appropriate action to defend our businesses and workers against any such discrimination," U.S. Trade Representative Robert Lighthizer said.
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If approved, the bill would apply a levy of 3% on the local digital revenue of companies with annual global sales of more than 750 million euros and at least 3 million in Spain, lining up with an European Union proposal on the matter.
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guest · Jun 10, 2020

Thailand proposes to tax foreign internet companies
June 9, 2020
https://in.reuters.com/article/us-t...-tax-foreign-internet-companies-idINKBN23G1K0

Thailand on Tuesday approved a draft bill requiring foreign digital service providers to pay a value-added tax (VAT), becoming the latest country in Southeast Asia to seek to boost tax revenues from international tech companies.

Thailand is expected to add about 3 billion baht ($95.72 million) to its coffers annually from the move, which will affect services such as music and video streaming, gaming, and hotel booking, she added, without naming any companies.
Thanawat Malabuppha, president of the Thai e-Commerce Association, told Reuters he welcomed the move, as it will help level the playing field for rival Thai businesses.

“Anyone who makes money from Thai people should pay taxes to the country,” he said.
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Southeast Asian regulators held talks last year on a region-wide effort to tax tech giants more, while industry groups have warned that over-regulation could blunt the region’s booming digital economy.
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guest · Jun 18, 2020

U.S. pulled out of stalled talks on digital services taxes: Lighthizer
June 17, 2020
https://www.reuters.com/article/us-...gital-services-taxes-lighthizer-idUSKBN23O36B

U.S. Treasury Secretary Steven Mnuchin decided to pull out of negotiations on digital services taxes with European Union officials after they failed to make any progress, U.S. Trade Representative Robert Lighthizer said on Wednesday.

Lighthizer told U.S. lawmakers that he still believed an international regime was needed to deal with taxation, but the talks with European countries were not proving fruitful.

“We were making no headway and the Secretary made the decision that ... rather than have them go off on their own, you would just say we’re no longer involved in the negotiations,” he said during a hearing of the House Ways and Means Committee.
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guest · Jun 18, 2020

Spain will not accept threats over digital tax - govt spokeswoman
June 18, 2020
https://www.reuters.com/article/usa...er-digital-tax-govt-spokeswoman-idUSL1N2DV0CJ

Spain and its European allies will not accept any threats over a proposed tax on internet giants’ revenues, government spokeswoman Maria Jesus Montero said on Thursday, a day after Washington decided to pull out of talks on the matter.

Asked during an interview on Cadena SER radio about the so-called “Google Tax”, Montero said,

“Neither Spain, nor France, nor Italy, nor Britain, no country will accept any type of threat from another country.”
“We are not legislating to damage the interest of other countries,” Montero continued. “We are legislating so that our tax system is orderly, fair and adapted to current circumstances.”
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guest · Jun 18, 2020

UK says it still wants global digital tax as U.S. quits talks
June 18, 2020
https://uk.finance.yahoo.com/news/uk-says-still-wants-global-064526749.html

Britain will keep pushing for a global solution on taxing international digital companies such as Google <GOOG.O> and Facebook Inc <FB.O> after the United States left negotiations, a spokesman for the British Treasury said on Thursday.

"We remain committed to a global solution," the spokesman said.
U.S. Treasury Secretary Steven Mnuchin decided to pull out of talks on digital services taxes with European Union officials after they failed to make any progress, U.S. Trade Representative Robert Lighthizer said on Wednesday.
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hawki · Jul 10, 2020

mood said: ↑

France warns U.S. against digital tax retaliation
January 6, 2020
https://in.reuters.com/article/fran...against-digital-tax-retaliation-idINKBN1Z50QZ
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"U.S. Will Impose Tariffs on French Goods in Response to Tech Tax

WASHINGTON — The Trump administration on Friday said it would impose new tariffs on $1.3 billion worth of French goods, including cosmetics, soap and handbags, in retaliation for a French tax that largely hits American technology companies, escalating a trade dispute that threatens to further damage the global economy..."

https://www.nytimes.com/2020/07/10/...-on-french-goods-in-response-to-tech-tax.html

ronjor · Jul 14, 2020

Crunch time for Apple in fight against $15 billion EU tax order

Foo Yun Chee, Padraic Halpin JULY 14, 2020
BRUSSELS/DUBLIN (Reuters) - Apple’s clash with EU competition regulators comes to a head on Wednesday as Europe’s second-highest court rules on whether it has to pay 13 billion euros ($15 billion) in Irish back taxes, a key part of the EU’s crackdown against sweetheart tax deals.
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ronjor · Jul 15, 2020

Apple wins tax battle with EU as court annuls 2016 order to pay $15 billion in taxes

Silvia Amaro@Silvia_Amaro Jul 15 2020
The Commission said that Ireland had enabled Apple to pay “substantially less tax than other businesses over many years” in a 2016 decision.
Taxation is taking an even more prominent role in the wake of the Covid-19 crisis. With many governments stepping up their spending, they will be looking for new sources of revenue in the form of taxation.
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guest · Jul 29, 2020

Philippines Moves Closer to Taxing Tech Giants
July 29, 2020
https://www.usnews.com/news/technol...hilippines-moves-closer-to-taxing-tech-giants

A proposed bill that will allow the Philippines to tax tech giants like Facebook, Alphabet's Google and Youtube, and Netflix, moved a step closer to becoming a law after a lower house committee approved it on Wednesday.

The bill, which aims to raise 29 billion pesos ($590 million) to help fund government measures to fight the coronavirus, follows similar plans by other Southeast Asian countries to generate revenues from the most popular digital services.

"If brick-and-mortar establishments, which are the hardest-hit by the pandemic, have to pay VAT, the giants of e-commerce should not be exempt," Congressman Joey Salceda, the bill's principal author, said in a statement.
The bill proposes value-added tax of 12% on digital services. It still needs to clear the lower chamber and a similar bill has been submitted to the Senate.
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guest · Aug 24, 2020

Treasury denies it plans to drop 'Facebook tax' in favour of trade deal
August 23, 2020
https://www.theguardian.com/busines...tax-covid-in-favour-of-post-brexit-trade-deal

The Treasury said on Sunday it would drop the digital services tax when there was a global agreement on how to tax big multinational tech firms, which pay very little tax in the UK and other countries where they operate.

The government poured cold water on a report in the Mail on Sunday that Rishi Sunak was preparing to ditch the tax following pressure from US companies and politicians in order to win a favourable trade deal.
A Treasury spokesperson said: “We’ve been clear it’s a temporary tax that will be removed once an appropriate global solution is in place – and we continue to work with our international partners to reach that goal.”
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ronjor · Aug 24, 2020

Facebook to pay more than $110 million in back taxes in France

Mathieu Rosemain August 24, 2020
PARIS (Reuters) - Facebook’s (FB.O) French subsidiary has agreed to pay more than 100 million euros ($118 million) in back taxes, including a penalty, after a ten-year audit of its accounts by French tax authorities, the company said on Monday.
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guest · Sep 2, 2020

Google's advertisers will take the hit from UK digital service tax
Tech giant will charge additional fee from November for advertising
September 1, 2020
https://www.theguardian.com/media/2...will-take-the-hit-from-uk-digital-service-tax

Google is to pass the cost of the UK’s digital services tax on to advertisers, adding more than £120m to marketers’ costs annually, as the government’s attempt to get tech giants to pay more to the exchequer is billed to their customers.

Google has told its tens of thousands of clients that from November it will charge an additional fee for ads served on Google and YouTube. The move will increase advertisers’ costs in line with the amount the tech giant is set to pay in new digital services taxes as they come into force: 2% in the UK, and 5% in Austria and Turkey.

“Digital service taxes increase the cost of digital advertising,” said a Google spokeswoman. “Typically, these kinds of cost increases are borne by customers and like other companies affected by this tax, we will be adding a fee to our invoices, from November [...]”
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“We have been consistent in warning government of the potential consequences of this approach, including an increase in costs to advertisers in the UK market,” he said.
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xxJackxx · Sep 2, 2020

mood said: ↑

Google's advertisers will take the hit from UK digital service tax
Tech giant will charge additional fee from November for advertising
September 1, 2020
https://www.theguardian.com/media/2...will-take-the-hit-from-uk-digital-service-tax
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...and it's like I said on page 2. Google isn't paying anything. The advertisers will pay it. And raise prices to the consumer. Taxing the rich always sounds like a good idea since they have more money than they could ever spend but they will never be the ones to pay for it.

guest · Sep 3, 2020

Big Tech finds a way to pass on the cost of digital taxes in Europe
September 3, 2020
https://www.cnbc.com/2020/09/03/big...s-on-the-cost-of-digital-taxes-in-europe.html

Apple has announced that it will increase its charges for app developers, as it becomes the latest tech giant to pass on some of the costs of new digital taxes to smaller businesses.
The move, announced Tuesday, comes after countries including the U.K., France, Italy and Turkey implemented digital services levies, which force tech giants to pay more taxes.

“When taxes or foreign exchange rates change, we sometimes need to update prices on the App Store,” Apple said in a statement.
Google too
Apple is not the only company passing on the costs of the new taxes.
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Amazon: Upcoming fee changes in the UK following introduction of Digital Services Tax

Now that the legislation has passed, we want to inform you that we will be increasing Referral fees, Fulfilment by Amazon (FBA) fees, monthly FBA storage fees and Multichannel Fulfilment (MCF) fees by 2% in the UK to reflect this additional cost.
Comment
This tax was brought in to try to make companies like Amazon, who earn huge profits while contributing very little tax in the UK, pay what is due. They were not designed to be passed on to the sellers, who are mainly small businesses, who already have to pay 20% in VAT plus corporation tax in the UK. This is outrageous and shows the contempt that Amazon has for the UK and it’s marketplace sellers.
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guest · Sep 9, 2020

France Says U.S. Blocking Global Digital Tax Talks
September 9, 2020
https://www.usnews.com/news/technol...nce-says-us-blocking-global-digital-tax-talks

France accused the United States on Wednesday of seeking to undermine international talks to update cross-border taxation for the digital age and urged Europe to prepare an EU tax if the negotiations fail.

Nearly 140 countries are negotiating the first major rewrite of international tax rules in a generation to account for the rise of big digital companies like Google and Amazon.
Washington called for a pause in the talks earlier this year after suggesting any deal should include a voluntary opt-in mechanism for U.S. companies and raising qualms about the scope of the tax.

"It's very clear, the United States don't want a digital tax (deal) at the OECD. So they are making obstacles that prevent us from reaching an agreement even though the technical work is done," French Finance Minister Bruno Le Maire told journalists.
In the absence of a global deal, some European countries have followed France in creating their own national digital services tax, which in France's case has made it the target of U.S. threats of retaliatory tariffs.
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guest · Sep 11, 2020

France renews push for EU digital tax if global efforts fail
September 11, 2020
https://in.reuters.com/article/euro...ital-tax-if-global-efforts-fail-idINKBN2620WG

France’s finance minister said on Friday that the European Union should push ahead with its own digital tax early next year if broader efforts to find a global solution do not bring a breakthrough in the coming months.

Speaking to reporters at a meeting of European finance ministers in Berlin, France’s Bruno Le Maire said he wanted to have a fair and efficient international taxation system as soon as possible, ideally within the OECD framework.

“If you look at the consequences of the economic crisis, the only winners are the digital giants,” Le Maire said.
“If it proves to be impossible to get a consensus by the end if this year at the OECD level, we should have, by the beginning of next year, 2021, a European solution for digital taxation.”
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guest · Sep 21, 2020

The Deadline for the European Commission to Appeal the €13.1 Billion case against Apple for illegal state aid from Ireland is Friday Sept. 25
September 20, 2020
https://www.patentlyapple.com/paten...apple-for-illegal-state-aid-from-ireland.html

In Mid-July Patently Apple posted a report titled "Apple has won a Landmark Court Case in Europe today with the Court ruling that Ireland did not give Apple a Tax Advantage."
The EU’s general court decided that the European Commission did not prove that the Irish government had given the U.S. tech giant a tax advantage

If the commission does not lodge an appeal by Friday, September 25th, the Government will move quickly to start returning the money, which totaled €14.3 billion when interest was included and has been sitting in escrow since 2018, to Apple. The escrow funds are mainly held by way of bonds, rather than cash.
Ms. Vestager added: "We haven’t taken that decision yet. As the commission always does, we'll wait until we're closer to the deadline of the appeal question, and then of course I’ll be happy to come back to that."
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guest · Sep 25, 2020

EU appeals against Apple ruling in $15 billion tax battle
September 25, 2020
https://www.cnbc.com/2020/09/25/eu-appeals-against-apple-ruling-in-15-billion-tax-battle.html

The battle between the EU and Apple on taxation is not over yet.

On Friday, the European Commission, which is the executive arm of the EU, said it would appeal a court ruling involving Apple and the Republic of Ireland.
The EU’s general court ruled in July that the Commission had failed to prove that the Irish government had given a tax advantage to the tech giant.

“The Commission has decided to appeal before the European Court of Justice the General Court’s judgment of July 2020 on the Apple State aid case in Ireland,” Vestager said in a statement Friday.
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Rasheed187 · Sep 26, 2020

mood said: ↑

EU appeals against Apple ruling in $15 billion tax battle
September 25, 2020
https://www.cnbc.com/2020/09/25/eu-appeals-against-apple-ruling-in-15-billion-tax-battle.html
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Awesome stuff, I hope they will win this case against Ireland and Apple. Big companies should stop with these insane tax evasion practices.

guest · Oct 12, 2020

Global watchdog proposes tax overhaul for Big Tech
October 12, 2020
https://apnews.com/article/paris-france-tax-reform-europe-archive-bc18de1f6f3e657f6162b4c2e810f21b

A global economic watchdog on Monday proposed an overhaul of international tax rules to make sure big tech companies pay their dues, and warned that failure to adopt it would make the economic recovery from COVID-19 harder.

The Paris-based Organization for Economic Cooperation and Development, which advises the world’s top economies, said its global tax overhaul framework will be presented to Group of 20 finance ministers meeting this week and could be implemented by mid-2021 if an agreement is reached. The group estimated the measures could raise an extra $100 billion in corporate tax revenues annually.
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If countries don’t all agree on the new tax rules, the OECD warned that there’s a risk of a global trade war triggered by many individual countries launching their own digital services taxes to help their economic recovery from the pandemic. The result is that global economic growth cut be cut by more than 1% annually.

“The last thing you want is, at this time of COVID-19, to have to deal at the same time with further trade tensions,” OECD Secretary-General Angel Gurria said in an online press briefing.
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guest · Oct 14, 2020

Amazon will NOT be impacted by £500m digital services tax - but smaller retailers will be, HMRC admits
October 14, 2020
https://www.dailymail.co.uk/news/ar...igital-services-tax-smaller-retailers-be.html

Retail giant Amazon will not by impacted by a new digital services tax - but traders who use the site will be, the HMRC has revealed.

In June Rishi Sunak signed a letter alongside counterparts in France, Spain and Italy declaring that tech giants needed to 'pay their fair share of tax'.
But just seven months after the tax was announced in March, HMRC has revealed Amazon, which paid £293million in taxes on sales of £13.73 billion, will not be affected by it, The Times reported.
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The paper claims the online retailer will only have to per a two per cent charge on revenues it receives from third-party sellers trading on its marketplace.
With Amazon expected to cover the cost by charging higher fees, putting it at an advantage compared to the businesses that use the website.

The British Independent Retailers Association has voiced its own opposition, warning the tax has penalised smaller retailers while giving Amazon the edge.
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ronjor · Nov 25, 2020

France orders tech giants to pay digital tax

By Reuters Staff November 25, 2020
PARIS (Reuters) - The French Finance Ministry has sent out notices to big tech companies liable for its digital service tax to pay the levy as planned in December, the ministry said on Wednesday.
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guest · Nov 30, 2020

Biden should clarify US position on digital tax within two months: France
November 30, 2020
https://www.business-standard.com/a...-within-two-months-france-120113000721_1.html

The European Union hopes Joseph Biden's incoming administration will clarify the U.S. position on digital taxation within two months of taking office, a French Finance Ministry source said on Monday.
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ronjor · Nov 30, 2020

Canada plans digital tax in 2022 on global tech giants such as Facebook, Google

By David Ljunggren November 30, 2020
OTTAWA (Reuters) - Canada plans to impose a tax on corporations providing digital services from 2022 that will stay in place until major nations come up with a coordinated approach on taxation, the Finance Department said on Monday.
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