Janet Yellen tells Europe to rethink digital tax – Financial and Economic News – Trends
US Treasury Secretary Janet Yellen has called on the European Union to reconsider its plans for a digital tax. She fears that such a tax on the digital economy would be “discriminatory against US companies”. On Monday, Yellen will participate in the Eurogroup consultations, where the topic will be on the agenda.
Yellen addressed the press in Venice on Sunday. In the Italian city, on Saturday, she reached an agreement with fellow ministers from other G20 nations on global tax reform that should, among other things, introduce a minimum tax rate for multinational companies. Yellen said the agreement “calls on states to phase out digital taxes that the United States considers discriminatory and to refrain from similar actions in the future.” She added that it was up to the Commission and EU member states to decide on the additional work plan.
fair taxes
In the European Union, the digital tax is seen as a way to get companies like Google, Amazon, Facebook and Apple to pay fair taxes. The tax should also provide a new source of revenue to finance the €750 billion economic recovery plan. The tax must be submitted by January 1, 2023 at the latest.
Janet Yellen will participate in the Eurogroup, the monthly meeting of eurozone finance ministers, in Brussels on Monday. European digital tax is on the agenda there. French Economy Minister Bruno Le Maire said that while Yellen would send a message that such a tax was no longer necessary, the EU wanted to reassure her and “provide the necessary clarifications”.
Washington fears not only that US multinationals will be discriminated against by European digital taxes, but also that plans for global tax reform will fail as a result.
Saturday’s agreement, the parameters of which have already been approved by 131 countries in the Organization for Economic Co-operation and Development, still needs further elaboration. A digital tax already exists in Spain, Italy and France, but it will be abolished once global tax reform is implemented. At the European level, heads of state and government announced at the end of March that the EU would take “steps forward” if there was no prospect of a global solution.
Yellen addressed the press in Venice on Sunday. In the Italian city, on Saturday, she reached an agreement with fellow ministers from other G20 nations on global tax reform that should, among other things, introduce a minimum tax rate for multinational companies. Yellen said the agreement “calls on states to phase out digital taxes that the United States considers discriminatory and to refrain from similar actions in the future.” She added that it was up to the Commission and EU member states to decide on the additional work plan. The tax should also provide a new source of revenue to finance the €750 billion economic recovery plan. The tax must be levied by January 1, 2023 at the latest, and Janet Yellen will participate in the Eurogroup on Monday in Brussels, the monthly meeting of eurozone finance ministers. European digital tax is on the agenda there. So, while Yellen will send the message that such a tax is no longer necessary, the EU wants to reassure her and “provide the necessary clarifications,” says French Economy Minister Bruno Le Maire. Not only does Washington fear discrimination against US multinationals affected by the European digital tax, but plans for global tax reform may also fail. A digital tax already exists in Spain, Italy and France, but it will be abolished once global tax reform is implemented. At the European level, heads of state and government announced at the end of March that the EU would take “steps forward” if there was no prospect of a global solution.
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