As US Treasury Secretary Janet Yellen aims to get European countries to support a broader international business tax deal, the European Union is postponing intentions for a common digital tax in the region, CNBC reported.
The Treasury secretary visited the EU’s headquarters on Monday, July 19, and met the region’s finance ministers at a time when the European Commission, the executive arm of the bloc, was due to put forward plans for a digital tax. The digital tax plan would help repay some of the debt incurred during the pandemic.
However, the Commission announced on Monday it was postponing its plans to focus on the ongoing discussions for a global corporate tax deal.
“The G-20 endorsed a stark agreement to create a more stable, fairer, international tax system, which addresses the tax challenges that arise from the digitalization of the economy,” a spokesperson for the European Commission said, explaining the reason for the delay.
The news comes as the White House has been heading up international talks that would make multinationals pay tax in every location where they run, with a 15%t levy at the least. As CNBC reported, the US “has been cool” on the concept of a digital tax in the region, as it is concerned that it will unfairly single out US companies.
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