The proposal of the European Commission for an interim tax, actively lobbied by Paris, has faced severe opposition in Brussels and Washington, as the EU already has VAT, an income tax based on the customer’s location. France, Italy, Spain, and the UK are also introducing a tax at the national level.
Addressing the digital tax plan, the US has warned of WTO actions over “discriminatory” taxes by the EU.
Earlier in the day, the Romanian Presidency of the EU announced there has been no agreement on the tax issue despite months of negotiations.
According to Eugen Teodorovici, Romanian Minister for EU Funds, European officials will be focused on trying to elaborate a common stance on the issue at a global level.
The plan is supposed to impose an additional tax aimed at giant tech corporations’ digital sales, in order to curb the practice of paying global levies in countries with lower tax rates. However, several EU countries have blocked the legislation, citing a possible loss in profits and possibble negative reaction by the United States.