EU To Agree Digital Tax By March, Says French Minister

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European-wide tax on tech firms to be agreed by March, predicts French finance minister

The European Union will reportedly reach an agreement by March to implement a digital services tax.

So said the French Finance minister Bruno le Maire, who admitted there were still some hesitant countries, but that progress was being made.

It comes after France implemented a digital tax on tech giants such as Google and Facebook after the European Union failed to reach an agreement before Christmas.

tax

Agreement soon

The comments about the digital or tech tax were made to the French newspaper Le Journal de Dimanche.

“We made a compromise offer to Germany in December and I am convinced that a deal is within arm’s reach between now and the end of March,” he reportedly said. “With the European elections just a few months away, our citizens would find it incomprehensible if we gave up on this.”

France of course pressed ahead with its own tax which came into force on 1 January 2019.

France’s so-called GAFA tax targets major digital firms and hopes to raise €500 million (£451m).

The tax has long been championed by French president Emmanuel Macron as a way to show that governments are capable of taking action to rein in large tech companies, which are seen as paying minimal tax in Europe due to their use of accounting loopholes.

The digital tax had been defeated in its previous form, due to opposition by Ireland, Scandinavian countries and Luxembourg. It needs unanimous approval by member states.

The European Union tax was only intended as an interim measure until a consensus was reached by the Organisation for Economic Co-operation and Development (OECD), across the world.

But delays have meant that some countries have pressed ahead with their own digital tax. The UK was one of the first after it proposed national digital taxes with a broader base. It intends to implement this tax by April 2020 if no EU or OECD agreement is in place before then.

Austria is reportedly the next European nation looking to impose a specialised ‘tech tax’ on tech giants.

Digital ads

France and Germany meanwhile have reportedly also reached agreement on a 3 percent tax on digital ads, and plan to introduce it in 2021 unless OECD members agree a global approach before that date.

For their part, tech companies have previously defended their tax structures, and insist they abide by tax laws as they’re currently written.

But British MPs have previously criticised tech companies’ tax arrangements as “immoral”.

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Author: Tom Jowitt
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