August 3, 2021

Under pressure from Washington, Europeans delay their digital tax project

The Europeans are giving up, temporarily at least, to introduce a digital tax. “We have decided to put our work on hold”, announced, Monday July 12, the Commission. To justify its decision, the community executive invokes the agreement on the taxation of multinationals, concluded under the aegis of the Organization for Economic Co-operation and Development (OECD), thanks to the American impetus, and approved this weekend. end by the G20 in Venice. This is “Of a historic agreement (…) which responds to the challenges created by the digitization of the economy ”, explains a spokesperson for the institution. While the G20 must now agree on its setting to music by October, for entry into force in 2023, the Commission “Will concentrate its efforts on this objective” and postpone his project.

Janet Yellen, who was in Brussels on Monday, could not have asked for a better reception. The agreement on the taxation of multinationals “Calls on countries to agree to dismantle existing digital taxes that the United States considers discriminatory and to refrain from instituting similar measures in the future”, had indeed declared the Secretary of the American Treasury, the day before, at the end of the meeting of the G20 in Venice. It was therefore fully granted. “It is certain that the image of a European Union [UE] autonomy of the United States is taking a bit of a beating. But basically, it suits everyone to push back. This will give us time to assess the consequences of this weekend’s agreement, which is something huge ”, says a senior official.

Read also Global taxation of multinationals: the United States calls on the European Union to review its digital tax project

After meeting several Commissioners, including Paolo Gentiloni (for the economy) and Vice-President Valdis Dombrovskis, then having lunch with the President of the European Executive, Ursula von der Leyen, and the President of the European Central Bank, Christine Lagarde Janet Yellen therefore quietly attended the meeting of euro zone economic ministers, in a very good-natured working atmosphere. Even though she repeated to hope “That all EU member states” will join the agreement on global taxation – Ireland, Hungary and Estonia are among the eight countries to have refused – the former boss of the Fed did not seek the debate. It must be said that the president of the Eurogroup, Paschal Donohoe, is none other than the current Irish finance minister.

Do not complicate the vote in the US Congress

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