Content |
Digital tax in Ukraine
Main article: Digital tax in Ukraine
Digital tax in Spain
2021: Digital tax against Google and Facebook scrapped
In October 2021, the US government announced an agreement with European countries to abolish taxes on digital services. Taxes will be phased out amid the introduction of a new global income tax system for multinationals agreed by the Organisation for Economic Co-operation and Development (OECD).
According to Telecompaper, the United States threatened with Austrian sanctions,,, and France Italy Spain for Great Britain their digital taxes, which affect mainly large American Internet companies, such as and. Facebook Google The political compromise reached removes the threat to other industries suffering from conflict, the publication said.
The deal allows European countries to keep digital taxes in place until new tax rules come into force. Any difference between collected taxes and amounts payable under the new rules in the first year may be credited to the companies' account after their final filing and settlement by the tax authorities. The deadline for the implementation of the first phase of the contract is the end of 2023.
Earlier, the European Commission published two bills: the "Law on Digital Markets" and the "Law on Digital Services," Bloomberg reports. Both documents aimed at limiting the activities of world tech giants are actively discussed both at the level of individual countries and at the level of the entire European Union. The Commission set a goal - to reach an agreement between the participating countries and the European Parliament in 2022.
In September, it was assumed that the EU countries would sign a corresponding agreement by the spring of 2022, but in a later draft communiqué this goal was formulated differently. The Digital Markets Act aims to curb anti-competitive practices and the Digital Services Act aims to regulate online content. The entry into force of both documents could affect the work of Apple, Alphabet and Amazon, experts say.[1]
2020: Spain imposes tax on cloud services of foreign companies
In early June 2020, it became known about the introduction of Spain taxes on cloud and other Internet services of foreign companies. The government does not see discrimination in these measures, despite criticism from the American authorities. This statement was made after USA they paid close attention to such bills of foreign countries.
The Spanish authorities are introducing an additional tax of 3% on foreign IT companies with global revenues of more than 750 million euros per year and more than 3 million euros in Spain. The introduction of the tax, which would generate about €1bn a year for state coffers, is a longstanding ambition of a left-wing coalition government led by Pedro Sanchez.
On the eve of the meeting of the Congress of Deputies of Spain, at which this bill was supposed to be discussed, the Office of the US Trade Representative decided to open an investigation into the actions of the European Union and nine countries, including Spain, which plan to introduce the so-called "tax on Google."
In addition to Spain, the department has launched an investigation into Austria,, Brazil,, Czech Republic India Indonesia,, Italy Turkey and. Great Britain
US Trade Representative Robert Lighthizer said that US President Donald Trump is concerned that the listed states want to use the new tax schemes "to unfairly affect American companies," which in essence - as he believes - is discriminatory actions.
If they are recognized as such, Trump can be used by the provision of Chapter 301 of the Act and to trade impose sanctions on these states if the bill is passed.
A few months ago, the Office of the United States Trade Representative completed a similar process for France, which is also going to impose additional taxes on foreign IT companies operating in the country. In response, the US authorities decided to impose a 100 per cent tax on a number of French imported goods such as wine and cheese. [2]
Digital tax in France
2020
France starts levying tax on cloud services despite threat of US sanctions
At the end of November 2020, Le Figaro reported that the French tax authorities began to demand payment of tax on digital services, despite the threat of sanctions from the outside. USA Although the French government approved the introduction of an income tax for such American digital giants as Google and, Facebook back in July 2019, tax collection was temporarily suspended in January 2020 as part of a truce reached with. United States Administration
The source reports that the French government has taken seriously the threat of US sanctions, which will come into force in early 2021, but considers it necessary to introduce a tax on cloud and digital services. The French Ministry of Finance considers such a tax the most effective lever for revising tax regulations related to multinational companies. It is assumed that the United States and France will be able to reach a compromise by mid-2021. Earlier, the process of finding a solution was disrupted due to the decision of the US administration to withdraw from negotiations.
France was reported to have raised €350m in digital services tax in 2019, with revenues expected to rise in 2020. Under the new law, companies are required to pay 3 percent of profits made on French territory to the French treasury. In total, we are talking about 30 enterprises, including American, Chinese and French. According to section 301 of the 1974 Trade Act, the American president has the opportunity to impose duties on the country that fines American enterprises, and the United States intends to introduce financial sanctions from January 2021, in particular, to increase customs duties. France has already tried to convince its European partners of the benefits of such a law at the European Union level, but Scandinavian countries and especially Ireland objected to it.[3]
France imposes tax on cloud services of foreign companies
On May 4, 2020, it became known that the French government decided to impose a so-called digital tax on large IT-Business businesses, regardless of whether an agreement will be reached to raise tax rates for high-tech companies along with other states. The tax, in particular, will apply to cloud services.
Nearly 140 countries in the Organization for Economic Co-operation and Development (OECD) are in talks for the first major reform of the tax code, which will allow them to improve the effectiveness of collecting taxes from large IT companies such as Amazon, Facebook, Apple and Google, which often profit in countries with low tax rates.
In January 2020, Paris proposed to suspend the digital tax on the income of technology companies in France until the end of 2020, until an international deal is agreed. However, the detrimental impact of the coronavirus (COVID-19) pandemic on the economy forced the Ministry of Finance to reconsider the deadline.
 | Never has a tax on digital companies been so justified and necessary, "French Economy Minister Bruno Le Maire told reporters. He added that the companies in question are carrying the pandemic more easily than many others. |  |
The minister said France that in 2020, in any case, he will introduce a digital tax for IT companies - whether an agreement will be reached within the OECD or not.
| | If we do not have time to agree with our partners in the organization, our state will introduce a tax at the national level, "he said. | |
Europe has long insisted that big tech companies doing business through Internet pay tax where they sell their services rather than in tax havens, choosing them deliberately as part of aggressive tax optimization. France announced the introduction of a digital tax in 2019. Several other European countries, including, and, have Italy Great Britain Spain either already introduced their own digital taxes or are planning to do so.[4]
The digital tax will annually replenish the French budget with an amount of 500 million euros, the authorities calculate.
Digital tax in Thailand
2020: Thailand imposes tax on cloud services of foreign companies
In early June 2020, Thailand approved a bill requiring foreign providers of cloud and other digital services to pay value added tax (VAT).
Thus, Thailand has become another country in Southeast Asia that is trying to increase tax revenues from international technology companies. In May 2020, Indonesia passed a law requiring large internet companies to pay VAT on sales of digital products and services, and in the Philippines, a legislator introduced a similar bill in parliament to tax digital services.
The Thai bill, for which the Thai parliament is still to vote, requires non-resident companies or platforms that earn more than 1.8 million baht ($82,831) a year thanks to the provision of digital services in the country to pay 7% VAT on sales. It is expected that Thailand will be able to receive about 3 billion baht ($137.84 million) annually as VAT.
Thailand ranks second in economic development in Southeast Asia and has spent years developing digital business taxation, hoping to push digital business development in the country. Thailand's e-commerce association also welcomes the move as it will help Thai companies compete with foreigners.
Meanwhile, nearly 140 countries from the Organization for Economic Co-operation and Development are in talks for the first major overhaul of tax rules to accommodate growth and international markets for big tech companies like Amazon, Facebook, Apple and Google. Southeast Asian regulators are also reflecting on a higher tax for these companies, despite warnings that over-regulation could stall the region's digital economy.[5]
Digital tax in the Philippines
2024: Philippines introduces 12% additional tax for foreign Internet services
On October 2, 2024, the president Philippines Ferdinand Marcos Jr. signed a law providing for the introduction of a 12 percent value added tax () VAT for foreign digital services. We are talking about search engines, online stores, cloud platforms, online MEDIA , etc.
The new requirements will affect Netflix Disney Plus,,, and HBO Google Amazon many other companies. The Philippine authorities cite similar practices by other states, in particular, and. Singapore Indonesia Malaysia The Philippine government intends to collect up to 105 billion pesos ($1.9 billion) from VAT in the period from 2025 to 2029. The Presidential Public Relations Office reported that 5% of this amount will be used to finance projects in the country's creative industry. At the same time, educational and socially significant services will be exempt from VAT.
| | This will promote fair competition between businesses that profit from consumers here in the Philippines. A level playing field allows the production of better products and services, "said Romeo Lumagui, Commissioner of the Bureau of Internal Revenue. | |
Philippine Finance Minister Ralph Recto, in turn, said that the introduction of VAT on digital services will ensure a fair tax regime for all enterprises in the relevant industry. According to him, this measure makes the necessary adjustments to the current system, which creates an unfair advantage for foreign digital service providers and weakens the country's tax base.
| | By doing this, we are helping to improve competition. Whether you are a local entrepreneur or a global giant, everyone will play by the same rules, "Recto emphasized.[6] | |
Digital tax in Kazakhstan
2021: Kazakhstan introduced a digital tax for foreign Internet companies
At the end of November 2021, deputies of the Senate of the Parliament of Kazakhstan adopted amendments obliging foreign Internet companies to pay tax for money earned in the country. The digital tax will be officially introduced from January 1, 2022. From that day, foreign Internet companies selling their goods and services in Kazakhstan will have to pay value added tax (VAT).
In addition, in order to ensure the completeness and timeliness of VAT payment by these companies, it is proposed to introduce the concept of "Merchant ID" - a unique set of symbols that identify a foreign company as the recipient of payment and/or transfer of money using payment systems.
According to the Committee on Finance and Budget of the Senate of the Parliament of Kazakhstan, the imposition of VAT on goods sold via the Internet was adopted based on the experience of implementing such a tax by developed countries (Australia, Great Britain, France). In general, the introduction of a digital tax will help equalize competitive conditions for Kazakhstani and foreign companies, the deputies say.
| | Starting next [2022], VAT will be applied for foreign Internet companies. That is, it, for example, will be a tax on Google. A retail tax, a tax regime for payment applications, will also be introduced. These measures are aimed at creating a tax culture of taxpayers, and this work is being carried out jointly with the Ministry of Finance, "said Deputy Minister of National Economy Azamat Amrin at a Senate meeting. | |
Earlier, the director of the department of large taxpayers of the Committee of State Revenues of the Ministry of Finance of Kazakhstan Anuar Suleimenov explained that as part of the value added tax, payment will be made at a rate of 12%.[7]
Digital tax in Uzbekistan
2020: Google starts paying tax on Internet services in Uzbekistan
On April 24, 2020, it became known that Google began paying tax on Internet services in Uzbekistan. Amendments were introduced to the country's tax code providing for the introduction of the so-called "tax on Google" on companies providing digital services.
According to the law, foreign legal entities that sell services and goods in electronic form, the place of sale of which is Uzbekistan, are recognized by taxpayers in terms of such services provided to individuals.
According to the Prime agency, citing the press service of the State Tax Committee (GOC) of the Republic of Uzbekistan, Google Commerce Limited became the first company to begin paying digital VAT. According to the results of the first quarter of 2020, Google paid a total of 85 thousand euros.[8]
The tax obliges foreign companies that provide paid services via the Internet to users of Uzbekistan to pay VAT in the amount of 15%. To register foreign Internet companies in Uzbekistan, the tax committee has created a special online resource - a VAT office, at tax.uz.
As of April 24, 2020, 9 foreign taxpayers voluntarily registered through the VAT office:
- Xsolla;
- Google Voice;
- Google Commerce;
- Apple Distribution International;
- Google Ireland Limited;
- Activision Blizzard International;
- Netflix International;
- Samsung Electronics.
| | Voluntary registration is evidence that foreign companies value their reputation and respect the laws of the countries in which they provide their paid services, the GOC said. | |
They also note that applications from foreign companies for registration through the VAT office continue to be received.
Digital tax in Italy
2019: Cloud service providers taxed in Italy
At the end of December 2019, the Italian parliament passed a bill that introduces a 3% tax on the income of digital service providers (including cloud), which receive more than $831 million in revenue worldwide and at least $6 million in Italy.
Italy A new tax levied on big tech companies has approved following suit. France It is assumed that this step will further exacerbate tensions in relations between European countries with, USA since the digital tax affects primarily large American technology corporations:,, and Facebook Alphabet Amazon others. According to the report, the new Wall Street Journal tax will enter into force on January 1, 2020 and will bring the country's budget an additional $800 million per year.
The European Union has discussed the possibility of a single digital tax for nearly two years, to no avail. Therefore, individual countries decided to introduce a tax individually. Dozens of countries, like France and Italy, are working to change the big corporate tax scheme to get a tax on big tech firms. They insist that these companies should pay taxes where they generate profits through Digital Signage, subscriptions, the use of user data, cloud services, etc.
However, the US strongly opposes taxes on digital services. The US government has threatened to impose new duties on the import of French wines, cheeses and designer bags into the country and threatens to take similar measures against Italy after the entry into force of the digital tax there.
| | The Italian tax on digital services discriminates against American companies, does not comply with the principles of international tax policy and is unusually burdensome for many American corporations, said US Trade Representative Robert Lighthizer[9] | |
Digital tax in the Czech Republic
Digital tax 7%
In November 2019, the Czech government approved the introduction of the so-called digital tax of 7%. It will have to be paid by large international companies with a turnover of 750 million euros in the world and 100 million crowns (3.91 million euros) in the Czech Republic, as well as with a user audience of more than 200 thousand people. Among them are Facebook and Google.
The new tax will be levied on revenues from sales of targeted advertising on digital platforms, as well as user data. The initiative will apply to services provided to Czech users.
The authors of the digital tax bill emphasize that taxation will apply to revenue rather than profit.
| | The taxable base will be revenue for services provided during the tax period. However, since not all this revenue will be received for services in the Czech Republic, only the part of it that applies to Czech users will be taxed, "said Czech Finance Minister Alena Shillerova. | |
It is planned to charge a new fee in the form of a monthly deposit. According to forecasts of the Czech Ministry of Finance, the digital tax could bring 2.1 billion kronor (90.7 million euros) to the budget in 2020 and 5 billion kronor (216 million euros) annually in subsequent periods.
According to the Reuters news agency, the Czech Republic is introducing a digital tax following a number of other European countries after the European Union failed to reach an agreement across the bloc in 2018. Similar steps, which were made, for example, by France and Italy, were sharply criticized by the US authorities, where the world's largest Internet companies are based.
The Czech Ministry of Finance says the bill is approved on the basis of previously announced ideas for pan-European legislation.[10]
Malaysia Internet Tax
Starting January 1, 2020 Google , it will begin levying a 6% tax on its cloud and other digital services in Malaysia. The American company was one of the first to respond to the new law in the country.
As the Ministry of Finance officials explained, the purpose of the tax is to level the playing field for local businesses, as well as to receive additional revenue to the budget from enterprises that are not based in Malaysia. According to the ministry, the 6% digital rate is considered low compared to other countries, but this is enough to get more than $500 million in profit.
All G Suite users have already received the first notifications about the change. Based on the email, the service tax amount will be charged to the purchase and displayed on a separate line in the transactions under Invoices and Payments. For more information on digital services tax, please refer to the official guidance on the Royal Customer Service website.
In addition to G Suite, other paid digital services, including the purchase of video, music and applications, are also subject to taxation from the beginning of 2020. Other Google services, including Google Drive, YouTube Premium and YouTube Music, are expected to be subject to the same digital tax.
Foreign companies providing digital services are allowed to register with the customs department starting October 1, 2019. Registration for foreign service providers is mandatory if the total cost of digital services provided to Malaysian consumers exceeds $71 thousand per year.[11]
"Google Tax"
Notes
- ↑ US agrees deal with European states to withdraw digital taxes
- ↑ [https://www.euractiv.com/section/digital/news/spain-says-digital-tax-wont-discriminate-against-countries-as-u-s-ups-ante/ Spain says digital tax won’t discriminate against countries as US ups ante]
- ↑ France to resume collection of digital service tax amid threat of US sanctions
- ↑ France to impose digital tax this year regardless of any new international levy
- ↑ Thailand proposes to tax foreign internet companies
- ↑ Philippines levies 12% VAT tax on digital services by tech giants
- ↑ Parliament of Kazakhstan adopted amendments on "tax on Google"
- ↑ Google began paying digital tax in Uzbekistan
- ↑ After France, Italy approves digital tax on tech giants
- ↑ Czech government approves digital tax aimed at internet giants
- ↑ Google to impose 6pc digital tax for Malaysian users from Jan 2020
| The site content is translated by machine translation software powered by PROMT. The machine-translated articles are not always perfect and may contain errors in vocabulary, syntax or grammar. Read original article If you find inaccuracies or errors in the results of machine translation, please write to editor@tadviser.ru. We will make every effort to correct them as soon as possible. |