Spain moves forward with new digital tax on tech giants despite US warning

EPA/MATTEO BAZZI
An external view of Google Italia's headquarters in Milan, northern Italy, 28 January 2016. Milan finance police on Thursday completed an audit into a Google group company, Google Ireland Ltd, which uncovered alleged tax evasion in Italy by the Internet giant amounting to 227 million euros for the 2009-2013 period. The audit will be delivered to the Italian inland revenue, L'Agenzia delle Entrate, which in turn will inform Google of a tax inspection - the first step towards an agreement between the group and the Italian authorities to close the tax dispute with an eventual reimbursement. Google allegedly dodged the taxes via a "stable hidden organization in Italy", according to the report of a tax audit conducted by Milan finance police.

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Spain’s government approved the introduction of new taxes on digital business and stock market transactions. The move has angered United States’ authorities and brought a threat of tariffs by Washington.
Other European countries, including France, Italy and Belgium have also decided to move ahead with their national digital tax if no international deal on digital taxation is reached within the OECD by the end of this year.
The OECD has been working on a solution about multinational companies who manage to find a way to avoid paying taxes. Big tech companies such as Google and Facebook pay most of their taxes in the EU country where they are based. They often pay very little in countries where they run large operations.
As a result of the US pressure, the Google tax will be levied only from the end of the year. By then, the government hopes an OECD international agreement on digital business taxes will be in place.
Spain wants to place a 3% tax on online ads, on deals brokered on digital platforms and on sales of user data by tech companies that have a turnover of more than €750 million a year internationally and more than €3 million in Spain.
The measures still require parliament’s approval.

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