The European Commissioner for Taxation, Pierre Moscovici, has sought to reassure the American authorities that the legislative proposal on the taxation of the digital economy, to be unveiled on Wednesday 21 March (see EUROPE 11982, 11983), was not aimed solely at American businesses.
“I can assure you that we are not targeting any individual companies, or any nationality with these measures. Our goal is to ensure a level playing field for all businesses” in the digital sector, the Commissioner wrote to the US Secretary for the Treasury, Steven Mnuchin, in a letter dated 16 March of which EUROPE has had sight.
He explains that the Commission will present two legislative proposals: - one aiming to reform corporate tax to better reflect the digital nature of the economy; - a temporary solution aiming to avoid fragmentation in the EU's response.
Moscovici went on to stress that an international solution remained the EU's preferred option.
The letter comes as the EU is attempting to negotiate an exemption to the taxes on steel and aluminium being prepared on the other side of the Atlantic (see article).
In an interview with the French daily newspaper, Le Monde, the Prime Minister of Luxembourg, Xavier Bettel, questioned the wisdom of launching a mechanism to tax companies that are mostly American, with a steel war in the offing.
On Friday 16 March, Mnuchin said that the United States was against any proposal that would isolate digital companies. “Some of these companies are among the greatest contributors to US job creation and economic growth”, he said. “Imposing new and redundant tax burdens would inhibit growth and ultimately harm workers and consumers”. (Original version in French by Élodie Lamer)