Loading...

Davos Breakthrough: France, US Agree to Press Ahead With Global ‘Digital Tax’ Talks

January 23, 2020 by Dan McCue
French Finance Minister Bruno Le Maire speaks to Reuters at the World Economic Forum in Davos, Switzerland.

The United States and France agreed Thursday to proceed with talks that could result in a global rewrite of cross-border tax rules for the digital era.

The agreement to temporarily set aside a brewing tariff war over France’s digital tax on big tech companies to focus on securing a broader global deal, was announced by French Finance Minister Bruno Le Maire at the World Economic Forum in Davos, Switzerland.

The announcement came after a series of meetings in Davos between Le Maire, U.S. Treasury Secretary Steven Mnuchin, and Angel Gurría, secretary general of the Organization for Economic Cooperation and Development.

“We had long talks this morning with the U.S. Treasury Secretary and the OECD Secretary General, and I am happy to announce to you that we have found an agreement between France and the United States, providing the basis for work on digital taxation at the OECD,” Le Maire said.

“It’s good news, because it reduces the risk of American sanctions and opens up the prospect of an international solution on digital taxation,” he added.

Le Maire and Mnuchin concluded their meetings at the forum by exchanging a series of written proposals for the first redrafting of international tax rules since the 1920s.

The proposals will be considered by the 137 member governments of the OECD when they meet next month in Paris.

Speaking to Reuter’s Axel Threlfall on the “Davos Today” television program Thursday morning, before his final meeting with Mnuchin, Le Maire emphasized just how far the two sides had come during negotiations at the forum.

“We arrived in Davos under threat of U.S. sanctions,” he said. “A few days later, we have the possibility of building together a very strong international solution for digital taxation.”

“Of course, we are all aware that, having a new international taxation system, being able to tax the digital activities, is complicated. It takes time. But we are on the right track,” he added.

Gurria has been working for years to create a level playing field on digital taxation. Now that the U.S. and France have agreed to de-escalate their dispute over a proposed French tax on big tech companies, he said a draft framework for global digital tax could be ready by summer.

“We have no Plan B — we just have to get it done,” he said this week while speaking on a Davos panel.

That’s because other countries, including Britain, Italy and Spain, are currently imposing their own national digital-tax regimes.

Le Maire told Reuters that reality overhangs every discussion of the digital taxation issue.

“The question is, what kind of taxation regime do we want?” he said. “Do we want to have a world in which everybody has their own national taxation on digital activities — a prospect that raises the concern over taxation conflicts among nations — or do we want the same system of international taxation for digital activities apply to everyone?

“I’m deeply convinced that the second option is the best option,” he said.

France has already postponed collection of its digital tax, and has said it will scrap its tax if an international accord can be reached.

One thing France does not want is the so-called optional taxation system that has been discussed in some quarters, Le Maire said..

“That’s a red line for us, because the reality is, no private company wants to be taxed,” he explained. “What we want is a system and a taxation solution that is credible, fair, and solid.”

A+
a-

Geopolitics

November 30, 2021
by Dan McCue
WTO Cancels Meeting, Delaying Vote on IP Waiver for COVID Vaccines

GENEVA, Switzerland — The World Trade Organization has postponed its first ministerial meeting in four years, citing concerns over the... Read More

GENEVA, Switzerland — The World Trade Organization has postponed its first ministerial meeting in four years, citing concerns over the new coronavirus variant. The move will effectively delay a vote on a waiver sought by several developing countries on the intellectual property rights for COVID-19 vaccines... Read More

November 19, 2021
by Tom Ramstack
Congress Seeks to Regain Influence in United Nations

WASHINGTON — A top State Department official continued the Biden administration’s theme of “We’re back” during a congressional hearing Thursday... Read More

WASHINGTON — A top State Department official continued the Biden administration’s theme of “We’re back” during a congressional hearing Thursday on the United States’ role in the United Nations. The State Department is trying to regain leadership positions that suffered setbacks during the go-it-alone international policies... Read More

November 4, 2021
by Kate Michael
Abbott Defended Australia’s AUKUS Sub Agreement in Special Trip to U.S.

WASHINGTON — The United States, France and Australia have been in a public fight over a canceled submarine deal that... Read More

WASHINGTON — The United States, France and Australia have been in a public fight over a canceled submarine deal that has heated since the three nations came together at the COP26 environmental talks in Scotland. In the days leading up to the Glasgow discussions, Tony Abbott,... Read More

Investors Bet Big On Climate Fight But Motives Questioned

GLASGOW, Scotland (AP) — Governments and big investors announced fresh steps Wednesday to pour trillions of dollars into curbing global... Read More

GLASGOW, Scotland (AP) — Governments and big investors announced fresh steps Wednesday to pour trillions of dollars into curbing global warming, reflecting the financial world's growing embrace of efforts to fight climate change as both a business necessity and opportunity.  But some social justice activists called... Read More

November 2, 2021
by Reece Nations
Bipartisan Senate Legislation Aims to Prevent Foreign Extortion

WASHINGTON — Sens. Thom Tillis, R-N.C., and Sheldon Whitehouse, D-R.I., announced the introduction of legislation to the Senate on Tuesday... Read More

WASHINGTON — Sens. Thom Tillis, R-N.C., and Sheldon Whitehouse, D-R.I., announced the introduction of legislation to the Senate on Tuesday that would criminalize bribery demands by foreign officials. Although bribery is considered criminal activity under the Foreign Corrupt Practices Act of 1977, current law only punishes... Read More

Troubles at Home Shadow Biden's Climate Efforts Abroad

GLASGOW, Scotland (AP) — President Joe Biden joined other world leaders Tuesday to highlight the importance of preserving forests as... Read More

GLASGOW, Scotland (AP) — President Joe Biden joined other world leaders Tuesday to highlight the importance of preserving forests as a force against global warming, whipping up ambitions at a U.N. climate summit abroad even as a coal-state U.S. senator is again threatening Biden's landmark climate... Read More

News From The Well
Exit mobile version