U.S. Treasury Secretary Steven Mnuchin opposes a proposed European Union regulation that would levy a tax on mostly U.S.-based digital businesses, calling the so-called digital tax harmful and redundant, The Wall Street Journal reported March 16.
"The U.S. firmly opposes proposals by any country to single out digital companies. Imposing new and redundant tax burdens would inhibit growth and ultimately harm workers and consumers," Mnuchin said in a March 16 statement provided to the WSJ.
The proposed regulation is anticipated to be announced in the week of March 19 and is likely to enforce a tax of 3% from earnings of companies, though the exact rate could still be changed. French Finance Minister Bruno Le Maire recently said the European Union is planning to collect taxes in the range of about 2% to 6% of tech companies' revenues.
The bloc expects the tax to generate about €4.8 billion annually, the Financial Times reported, citing a draft proposal. The tax would target digital advertising such as that sold by Alphabet Inc.'s Google or Facebook Inc., fees from digital subscribers to services such as Apple Inc.'s music subscriptions, and income earned by entities selling data to third parties.
Tax charges will be enforced on online companies with annual global turnover of more than €750 million and EU-generated total taxable revenues of about €50 million.
