EU Digital Tax Proposal Is Discriminatory And Harmful to Europe’s Digital Economy

BY Heather Greenfield
March 21, 2018

Brussels, BELGIUM — The European Commission today presented a package of digital tax proposals. The package contains two legislative proposals, including a Directive introducing “an interim tax on certain revenue from digital activities.” This controversial digital services tax will be set at 3% of companies’ gross revenues from making available advertisement space, intermediation services and transmission of user data.

In parallel the Organisation for Economic Co-operation and Development, (OECD) is seeking international tax reform. The OECD’s “Interim Report on Tax Challenges Arising from Digitalisation”, released Friday, criticised the EU’s measures. The report notes that “There is no consensus on either the merit or need for interim measures and therefore this report does not make a recommendation for their introduction.” The OECD also concludes that “it would be difficult, if not impossible, to ring-fence the digital economy from the rest of the economy.”

The following can be attributed to CCIA Europe’s Vice President, Christian Borggreen:
“The proposed turnover tax aimed at online platforms is discriminatory and ignores the global consensus that the so-called ‘digital economy’ should not be singled out. Our economies are increasingly digital and digital companies pay as high of an effective corporate tax rate as traditional companies. We encourage the EU to seek international tax reform through the OECD rather than pursuing discriminatory, unilateral actions with risks to Europe’s digital economy and international trade relations.”

For media inquiries, please contact Heather Greenfield hgreenfield@ccianet.org

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