Brussels buries the «Google Rate» for the opposition of Ireland, Sweden, Finland and Denmark
The Ministers of Economy and Finance of the European Union (EU) have decided this Tuesday give up introducing a digital tax at the community level, after noting that several countries maintain their opposition to this measure, and focus on working to achieve a global solution in the OECD.
The Organization for Economic Cooperation and Development (OECD) has planned to have conclusions on how to address the challenges of digitization of the economy in 2020. If by the end of that year an international solution has not been achieved, the European Union leaves the door open to re-discuss the tax at the community level, as indicated by the Romanian Finance Minister, Eugen Teodorovici.
For the Spanish Minister of Economy, Nadia Calviño, it is "a missed opportunity" and affirmed that "It was worth it" to approve the tax even in its reduced version, since having a common approach would have given more weight to the EU in the negotiations in the OECD. Calviño has also pointed out that Spain does not renounce having this tax at the national level in the future. All this, despite the fact that the 28 A has been precipitated by the rejection of the Budgets.
«I regret that there is no agreement on the text of commitment ", pointed out Teodorovici, whose country presides until June the Council of the EU, during the meeting of economic headlines of the Twenty-eight held in Brussels. Again, opponents of the measure have been Ireland, Sweden, Finland and Denmark, who prefer a global solution in the OECD sphere and, furthermore, are against moving the tax burden to consumption instead of keeping it on production. This prevents achieving the unanimity necessary to approve the tax.
Those countries insist on their rejection of the measure, despite the fact that in December the twenty-eight had agreed to reduce their scope to tax only billing for advertising services of the big digital companies.
"What would happen to global growth if we started to apply excise taxes instead of where the added value is created? What would happen to the investments in the companies if we start to apply taxes on the invoicing? ", has alerted the Swedish minister of Finances, Magdalena Andersson, during the debate.
A very decaffeinated proposal
On Tuesday, even countries that supported the initial proposal of the European Commission, a 3% tax on billing for certain digital services of Internet companies that bill more than 750 million euros worldwide and more than 50 million in the EU, showed their disappointment with the reduced version that was discussed today.
It was the case of the Greek Minister of Finance, Euclides Tsakalotos, who has defended the need to act at the community level before a measure is adopted in the OECD but, at the same time, it has recognized that the current proposal has been "so diluted" that it "does not care" whether it is approved or not.
"We are going to imagine a defendant in a court and the prosecutor proposes twenty years in prison and the court decides that there will be ten and then the appellate court will sentence him to five years. Finally, the king or the president pardons him, "he said, on the "downhill" that it receives with respect to the community digital tax.
For his part, the European Commissioner for Economic Affairs, Pierre Moscovici, regretted that «A missed opportunity», but has clarified that the tax "is not dead" and that the European Commission will not withdraw its proposal since, he believes, it could serve as a basis for international negotiation and for countries that want to introduce their own rate.