US Treasury Secretary Janet Yellen said Washington is abandoning its opposition to global digital tax.
US Treasury Secretary Janet Yellen told her G20 colleagues that Washington is abandoning its opposition to a global digital tax, opening the door to such an agreement.
Washington’s change of position was considered a breakthrough. This is a big step forward on our way to a digital tax deal by the summer of this year, the German said Minister of Finance Olaf Schultz in a statement after hypothetical talks with his G20 counterparts.
French Economy Minister Bruno Le Maire also stated that an agreement should be reached by summer, calling for a “immediate conclusion” of the negotiations.
France agreed in 2019 to impose a tax on tech giants like Facebook, Amazon, Apple and Google, who were accused of funneling profits abroad. Paris has suspended collection of digital services tax until the end of 2020 in connection with the OECD talks. But the measure was met with heavy criticism from the Donald Trump administration, which planned to impose tariffs on French goods but canceled them in early January this year, before changing the guard in Washington.
Yellen pointed to the potential change in the US during a Senate hearing in January, saying she supports efforts to ensure companies pay their “fair share” and remove incentives for companies to engage in offshore activities.
In November, some 75 major tech companies, including Google and Facebo-ok, backed a French initiative requiring them to pay a “fair tax” in the countries in which they do business. Without an agreement, companies run the risk of proliferating national rules which could lead to double taxation.