UPDATE 1-EU plan to raise taxes for global internet firms hits snag

UPDATE 1-EU plan to raise taxes for global internet firms hits snag
From Reuters - September 16, 2017

TALLINN (Reuters) - A European Union plan to raise more tax from digital multinationals faced the first signs of scepticism on Saturday, as smaller members of the bloc warned about the economic impact from such a move.

France wants to tax companies like Google and Facebook on their turnover, rather than profits, to increase revenue from global online groups, accused of paying too little in Europe.

More than a third of the EUs 28 members backed Paris on Saturday at a meeting of EU finance ministers in Tallinn, the Estonian capital, but the move needs the agreement of all member states to reduce the risk of legal challenges.

We should be very careful, Denmarks finance minister Kristian Jensen said, warning of the risks of pushing innovative companies away from Europe.

His remarks were echoed by Luxembourgs finance minister Pierre Gramegna, who said any EU solution would need global backing to avoid damaging Europes competitiveness. It does not make any sense for Europe to move without a global agreement, he said.

The Czech Republic and Malta said a turnover tax would be technically difficult to implement.

If the divisions persist, a minimum number of ten EU states may apply the tax on their own under a procedure known as enhanced cooperation. Countries can also charge the tax unilaterally.



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