French sees more EU countries joining tax tightening efforts

Written by on September 15, 2017 in News with 0 Comments

French Finance Minister Bruno Le Maire
REUTERS/Philippe Wojazer

PARIS (Reuters) – French Finance Minister Bruno Le Maire said he expected more EU countries to join in the coming days a French-led push to tighten the taxation of online giants like Google and Amazon.

Germany, Italy and Spain have already signed onto a French proposal that digital multinationals such as those two leading companies should be taxed in Europe based on their revenues, rather than only profits as at present.

Currently such companies are often taxed on profits booked by subsidiaries in low-tax countries like Ireland, even though the bulk of their sales comes from other EU countries.

Le Maire is due to present the plan to other EU counterparts at a meeting in the Estonian capital of Tallinn on Saturday.

“Other European countries will join on Saturday morning this French initiative that we want to succeed and to succeed quickly,” Le Maire told a news conference on Thursday.

Le Maire played down report in French newspaper Les Echos that the Germans were not fully on board with the initiative, saying he and his German counterpart Wolfgang Schaeuble were “on the same line”.

A French Finance Ministry source said the proposed tax was the best way to move quickly, because there were far fewer constraints under international tax law for a levy based on a company’s revenues than for profits.

Technical discussions would have to focus on defining how much revenue comes from a given country and what rate to use, a second ministry source said, suggesting that the rate would be of the order of several percentage points.

So far, the ministry is not putting out a figure of how much revenue the tax could raise.

However, an EU lawmaker’s study suggested EU states could have lost 5.4 billion euros ($6.4 billion) in tax revenues from Google and Facebook between 2013 and 2015.

($1 = 0.8401 euros)

(Reporting by Leigh Thomas; Editing by Sudip Kar-Gupta and Matthew Mpoke Bigg)

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