France Wants EU Digital Tax Deal by the End of 2018

Galtero Lara
Noviembre 9, 2018

French finance minister Bruno Le Maire has been outspoken on the issue, and today said France would only hold off implementing its own digital services tax if a deal is reached between European Union members by the end of this year.

Irish finance minister Paschal Donohoe said the levy would create a negative precedent by focusing on areas where consumers are located, rather than where services are produced. He added that Germany opposes aspects of the Commission's March digital services tax proposal concerning taxation of sales of data and the internet of things and would like to see the Commission proposal modified in this regard. German Finance Minister Olaf Scholz also said the tax should not be applied until the summer of 2020, and only if no global deal was reached on the same issue.

"There is no inconsistency with Mr. Scholz".

France, backed by EU-presidency holder Austria, wants a law proposal by the end of the year leaving little time to get opponents on side as European tax rules require unanimous backing by all EU members.

"We are net exporters", he said at the meeting, which was broadcast over the internet.

The change of tack comes after France and the European Commission first advocated a provisional bloc-wide solution until an global scheme is found at the Organisation for Economic Cooperation and Development, which groups major world economies.

Paris argues the measure would be a vote-winning accomplishment for mainstream EU politicians ahead of the European Parliament elections next May, in which anti-Brussels populists could do well.

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France has offered to delay an EU-wide tax on tech giants in a bid to salvage the levy, which faces fierce opposition from Ireland and the Nordic countries, in an embarrassing setback for Emmanuel Macron in Brussels.

"The debate shows that we're moving in the right direction". "I see no government in Sweden that would have any other opinion on this issue", said Sweden's Magdalena Andersson".

US Treasury Secretary Steven Mnuchin, meanwhile, called for a global solution to the problem, warning against "unilateral action".

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.

The option to introduce the tax in 2021 was discussed at an informal finance ministers' meeting in September and will be addressed again at a meeting of the EU's Economic and Financial Affairs Council on Tuesday, sources told Handelsblatt.

Danish Finance Minister Kristian Jensen warned that the proposed tax could lead to retaliation from the United States as the plan targets many US -based companies.

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