France, Italy, and Spain have said they would move ahead with their national digital tax if no international deal on digital taxation is reached within the OECD by the end of this year. The OECD has been working on a solution about multinational companies who manage to find a way to avoid paying taxes.
The digital tax was one of the key topics at this year’s World Economic Forum in Davos, Switzerland, where French President Emmanuel Macron and US President Donald J. Trump agreed to hold off a potential tariff war.
Washington agreed to not move ahead with imposing further tariffs on French products worth $2.4billion, while Paris agreed to suspend imposing a tax on companies like Google and Facebook until the end of the year. France warned though, that it will collect all the taxes retrospectively if a deal is not reached within the OECD.
“We are strongly engaged in finding a solution at the global level. Of course, if no solution is found at that level by the end of the year, we will keep implementing our national measure,” said Roberto Gualtieri, Italy’s finance minister. Gualtieri’s position was backed by Spain’s Minister of Economy, Nadia Calviño, who expressed her support of a common solution.
US Secretary of Treasury Steve Mnuchin warned that “if people want to just arbitrarily put taxes on our digital companies, we will consider arbitrarily putting taxes on car companies”.
France’s Finance Minister Bruno Le Maire said he believes the OECD would offer a good proposal that could lead to a political deal.
“We need to have a credible solution at the international level to avoid national solutions by European countries,” he said, and added that: “there is still some work to be done to agree on the basis to launch the work at the OECD.”