Weeks after Congress endorsed the creation of the ‘Google tax’ in Spain, which gave free rein to its parliamentary processing, the United States has suspended negotiations with Spain and other countries of the European Union such as France, Italy, the that the United Kingdom had joined. According to the Financial Times, the North American country has informed the countries by means of a letter sent by Steven Mnuchin, secretary of the Treasury.
The tax, officially called “Tax on Certain Digital Services”, it was not going to take effect officially until December 20, and it was to be transitory, “until a worldwide or at least European standard is approved”, as the OECD / G20 are also working on it.
But The United States opened the investigation to Spain and other countries, which threatened the possibilities of the tax, as happened in France, which halted its application, being already approved. Now, the United States threatens the countries present in the negotiation with establishing tariffs.
The United States still does not give arm to twist
The idea of the countries that have been approving the tax was that it be approved globally or at least in the European Union. The first set a longer term, and the second did not come to fruition. Now in Mnuchin’s letter it is appealed that there are other priority issues regarding the tax, warning governments that “they must concentrate their attention on handling the economic affairs resulting from covid-19”.
From the letter it can also be concluded that it is not that the United States wants a tax that levies less on its great technology companies, but that it does not want any, or at least that does not want it without prior negotiation in which to set conditions. “The United States continues to oppose digital service taxes and similar unilateral measures” and “if countries choose to collect or adopt such taxes, the United States will respond with the appropriate measures provided.”
At the moment, in Spain there have been no official reactions, but from France, Bruno Le Maire, Minister of Finance, has confirmed that the countries involved in the negotiation have responded to Mnuchin’s letter, in which they maintain who want to establish “a fair digital tax at the OECD level talks on the digital tax as soon as possible “
US threatens retaliation against Spain and other countries if they do not withdraw the ‘Google tax’: negotiations are broken