The European Union hopes that the incoming administration of Joseph Biden will clarify the US position on digital taxation within two months of taking office, a source from the French finance ministry said on Monday (November 30th).
The EU plans to move forward with a bloc-wide tax on digital services offered by companies like Google and Amazon if a global deal to rewrite the rules on cross-border taxation is not not concluded by mid-2021.
Efforts by the Organization for Economic Co-operation and Development (OECD) to update the rules for the digital age have stalled this year. Donald Trump’s administration hesitated at the prospect of signing a multilateral agreement shortly before the presidential election.
EU heads of state and government are due to look into the situation in March and decide on the way forward for the bloc, the French finance ministry source said.
“Obviously, March was not chosen by chance. March will be two months after Biden takes office… We hope to have contacts in these two months with the new American administration, ”said the source.
“Based on what the Biden administration says, the European Council – it’s at the level of EU heads of state and government – will give guidelines in March,” the source added.
France is pushing its European partners to prepare a European digital tax in early 2021 that could be quickly applied in the event that negotiations at the OECD fail again by the middle of the year.
Paris has its own national digital tax, but is committed to removing it as soon as there is an international agreement. He suspended the levy this year until December while negotiations at the OECD were underway.
Amazon and Apple opposition
On a related note, US tech giants Amazon and Apple haven’t signed a new French initiative to get global tech companies to publicly commit to principles, including paying their fair share of money. ‘taxes, government officials said Monday.
Amid a public outcry over the good fortune of tech groups during the coronavirus pandemic this year, Macron advisers said on Monday that the president had asked tech companies to sign up for a new initiative called “Tech for Good Call ”highlighting the principles of the post-COVID world.
The French government has released a list of 75 tech company executives who have signed up to the initiative so far, including Google CEO Sundar Pichai, Facebook’s Mark Zuckerberg and Microsoft chairman Brad Smith. Apple and Amazon were notably absent from the list.
Apple declined to comment, but French officials said discussions with the group are ongoing and they could still join the initiative, details of which will be officially released by Tuesday. An Amazon representative, whose French officials said they refused to join the initiative, did not return a request for comment.
“The goal is also … to objectively observe those who decide to play ball and to align their interest with individuals and societies and those who remain outside this common movement,” said a presidential adviser during a briefing.
Leading tech leaders like Facebook’s Zuckerberg attended the French President’s so-called Tech for Good summit at the Elysee Palace in 2018, which spawned task forces on issues that have become sources of tension between governments and “Big Tech”.
The new initiative is not legally binding, but French officials have said Macron will use it as a tool to influence upcoming negotiations in global forums on big tech regulation.
The signatories of the “Tech for Good Call” undertake to “contribute equitably to taxes in the countries where (they) operate”; prevent the dissemination of “material of child sexual abuse, terrorist content or extreme violence online”; and “supporting the ecological transition”, among others.