Following on from a call for action from four EU finance ministers, the European Commission published a report on 21 September 2017 setting out the issues on how to tax digital business and some possible solutions. These included, by way of short term fixes, an ‘equalisation’ tax on insufficiently taxed digital income, or alternatively a gross withholding tax on payments to non-resident digital providers. In the longer term the EU document put its faith in the proposal for a harmonized corporate tax system in the EU – or CCCTB – to resolve the issues, in particular by incorporating new – virtual – PE rules and new transfer pricing approaches adapted to digital business models. Finance ministers from around 10 Member States have expressed support for the equalisation tax option according to media reports, and a common understanding is expected to be reached in December. More or less at the same time as the EU discussions started, the OECD has requested public input on similar issues and is expected to issue an interim report in Spring 2018.
Related Posts
European Commission develops standard forms, formats for DAC7 compliance
The European Commission announced its plans to draft an implementing regulation featuring standard forms and digital formats on 18 November 2024. These tools will be related to the Amending Directive of the 2011 Directive on Administrative
Read MoreEU releases updated public CbC reporting forms
The European Commission (EC) published a revised regulation that provides the common template and electronic reporting formats for the EU public country-by-country (CbC) reporting directive on 21 October 2024. This follows after the conclusion of
Read MoreEU: European Parliament backs FASTER initiative
The European Parliament's plenary session adopted its opinion on 14 November 2024 after a consultation on the proposed Council Directive for the Faster and Safer Relief of Excess Withholding Taxes (FASTER). The opinion endorses the compromise
Read MoreEU: Public prosecutor probes EUR 520M VAT fraud linked to mafia networks across nations
The European Public Prosecutor's Office (EPPO) has announced, on 14 November 2024, that it launched an investigation into a EUR 520 million VAT fraud orchestrated by multiple mafia groups operating in various EU and non-EU countries. The
Read MoreEU issues new guidance on VAT for small businesses
European Commission, on 11 November 2024, released the Guide to the SME scheme and explanatory notes for the updated Small Enterprise Scheme (SME scheme), which will take effect on 1 January 2025. This guide aims to provide a better understanding
Read MoreEuropean Commission launches anti-dumping probe on Chinese choline chloride
The European Commission issued the Notice of initiation of an anti-dumping proceeding concerning imports of choline chloride originating in the People's Republic of China in the Official Journal of the European Union (OJEU) on 31 October
Read More