European Commission delays digital tax bill


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The European Commission is delaying a legislative proposal on an EU tax on internet companies and other digital platforms, the so-called digital tax. According to a spokesperson, the European Union’s governing body is first awaiting more detail of the tax agreement reached this weekend in Venice among the 20 “richest” nations, the G-20, on minimum earnings tax worldwide. It is expected in October.

The committee is due to present legislative proposals for a European digital tax next week. This plan has now been postponed, the spokesman said. He did not comment on whether the decision was taken due to pressure from the United States. US Treasury Secretary Janet Yellen, who is in Brussels on Monday for consultations with the Eurogroup, has strongly criticized the European plans, as she believes they mainly affect US companies.

At a summit in Venice, all members of the Group of Twenty supported a plan to introduce a lower global tax rate to prevent companies from shifting profits. This consensus should culminate in a comprehensive reform of the international corporate tax system. This means, for example, that the largest corporations have to pay taxes in the country in which they do business.


The tax agreement of the Group of Twenty – the group of 19 major industrialized countries plus the European Union – is based on a rate of at least 15 per cent. Furthermore, the profits of large corporations in the countries in which they are registered may also be subject to taxation. Many Internet companies, such as the US Amazon or China’s Alibaba, now only pay taxes in the country where the company is actually located, while they make a lot of money in other countries that lose tax revenue.

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The plan, agreed by the G7 nations of France, Italy, Japan, Canada, Germany, the United Kingdom and the United States, has already won the support of 130 of the 139 countries linked to the Organization for Economic Cooperation and Development. (OECD) discussed plans.

Among these signatories was the Netherlands, which is internationally considered a tax haven. Outgoing Finance Minister Wopke Hoekstra attended the G20 summit, although the Netherlands is not an official member.

Source: National Ports Agency

Megan Vasquez

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