EU states divided over digital services tax proposal ⋆ Alertify

EU states divided over digital services tax proposal

The EU countries remain divided on a proposal from the European Commission to implement a new digital tax on larger online groups providing services such as advertising. digital service tax eu

A meeting of EU finance ministers found that a majority is still missing to support the new tax, and some countries plan to pursue their own national initiatives instead.

But the plan, which requires the support of all 28 EU states, is opposed by a large number of them.

The Austrian government, which holds the rotating presidency of the EU this semester, said it hopes to reach a consensus on the proposal by the end its term at year-end.

“It is very difficult to see an agreement on the digital tax because so many technical issues are not solved yet,” Danish Finance Minister, Kristian Jensen, told reporters on the sidelines of a meeting of EU finance ministers.

READ MORE: UK to introduce new, 2% Digital Sales Tax from April 2020

He added that the proposed EU tax was devised in a way that would hit mostly U.S. companies and therefore it would attract U.S. retaliation. “Of course there will be a reaction from the U.S.” he said, calling the tax “not a good idea for Europe”.

His remarks echoed comments made by diplomats from several EU states, including Germany, Sweden, Ireland and Malta, in a meeting last week, according to EU officials.

UPDATE: As of October 14, Austria, France, Hungary, Italy, Poland, Spain, Turkey, and the United Kingdom have implemented a DST (digital service tax). Belgium, the Czech Republic, and Slovakia have published proposals to enact a DST, and Latvia, Norway, and Slovenia have either officially announced or shown intentions to implement such a tax.

Spain approved its DST, which will go into effect in January 2021.
The United Kingdom’s Finance Bill 2020, which contains the DST legislation, received royal assent in July. The DST is retroactively effective from April 1, 2020.