After several rounds of game of digital tax collection——
France and the United States restart dialogue to seek multilateral solutions
Science and technology daily (reporter Li hongce) on January 28, French Minister of economy and finance Bruno Lemaire and U.S. Minister of Finance Janet Yellen held telephone talks, and the two sides agreed to seek multilateral solutions for digital tax within the organization for economic cooperation and development (OECD). Earlier, French President Marco Polo had his first call with new US President Biden on the 24th.
The French Ministry of economy and Finance said in a press release that the French and US finance ministers agreed that “in the face of global economic problems, it is necessary to establish multilateral solutions to multilateral challenges, especially in terms of fair and equitable taxation of multinational companies.”. Lemaire welcomed the commitment of the new US team to actively participate in discussions within the OECD on digital taxation with a view to reaching an international agreement by the end of the first quarter.
The two finance ministers clearly hope to deepen intergovernmental ties and note that the French and US governments share many common priorities, especially in climate, international trade and cooperation within multilateral mechanisms. They agreed on the need to coordinate national policies to support the revitalization of the global economy, particularly within the G7 and G20 frameworks. The two sides also talked about “the need to reduce trade tensions, which will have a negative impact on economic growth, especially between the United States and Europe.”.
France has launched several rounds of confrontation with the US trump government on the issue of digital tax. France passed the digital tax bill on Transnational Internet giants in 2019, and then France and the United States reached a postponement agreement, that is, under the premise that the United States continues the global digital tax negotiations within the OECD, the United States postpones retaliatory measures, and France agrees to suspend taxation. OECD completed the tax reform framework for multinational digital companies in October last year, but the United States withdrew from the relevant negotiations in November, resulting in no agreement reached before the end of the year. France immediately stated that it would not suspend the collection of digital tax. The trump administration has threatened to impose a 25% tariff on $1.3 billion of French imports. The tariff directive came into effect on January 6, and the office of the U.S. trade representative finally announced the suspension of the tax on January 7.
Globally, Italy, India and Turkey have imposed digital taxes on US internet giants, while the UK, Austria, Spain, Brazil, Czech Republic and Indonesia have adopted or planned to implement digital taxes. At the same time, France is promoting the EU to levy digital taxes, which has put pressure on the us to return to the OECD negotiations.