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Report: EU officials say US more open to discussing taxation of tech giants


According to Market Intelligence, December 2022


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Report: EU officials say US more open to discussing taxation of tech giants

The U.S. government has reportedly changed its stance on participating in talks surrounding European plans to collect taxes from tech giants, including Google Inc., Apple Inc., Facebook Inc. and Inc., according to European officials, Agence France-Presse reported Oct. 14.

"The United States is open to considering the matter and they understand very well the need for the fair taxation of digital giants," French Finance Minister Bruno Le Maire said on Oct. 13, after speaking with U.S. Treasury Secretary Steven Mnuchin in a side meeting at the annual World Bank and International Monetary Fund meeting in Washington D.C., according to the report.

The European Commission, the executive arm of the European Union, is slated to present proposals for taxing large tech companies next year. In the interim, the Organisation for Economic Cooperation and Development plans to harmonize various governments' tax proposals to ease the harm they could cause to companies' financial positions and will present the G20 finance ministers with a report on the subject in April 2018, the report said.

"The news is the United States will sit at our table not to block the discussion, but to the contrary, to drive it and try to discourage, or at least limit, the damages these taxes could cause," AFP quoted Pascal Saint-Amans, the OECD's director of the tax policy and administration center, as saying.

The European Commission ordered Luxembourg on Oct. 4 to recover about €250 million from Amazon after a regulator found that the country's rules allowed the e-commerce giant to avoid paying taxes on a significant portion of its profits earned in the EU between May 2006 and June 2014. In 2016, the commission ordered Ireland to recover back taxes of up to €13 billion from Apple.

The U.S. Treasury Department reiterated its position on the taxes in a statement in October, noting that the agency opposes "retroactive tax assessments" by the European Commission, AFP reported.

Pierre Moscovici, the European commissioner for economic and financial affairs, said that the commission will "wait for the G20 to draw their own conclusions" from an OECD study and warned that "if a global solution is not forthcoming," the commission "will propose its own tax measures."

"To my mind, the best solution is the common consolidated tax base, in other words corporate taxes," he said, according to the AFP report.

Le Maire said that the U.S. government has agreed to the creation of a working group with France, which will allow a bilateral review of a few proposals made by the commission, according to the report.