Biden ought to make clear US place on digital tax inside two months, France says

© Reuters. FILE PHOTO: EU flags flutter in front of the headquarters of the EU Commission in Brussels

PARIS (Reuters) – The European Union hopes the new administration of Joseph Biden will clarify the US position on digital taxation within two months of taking office, a source from the French Treasury said Monday.

The EU is considering introducing a block-wide tax on digital services from companies such as Google (NASDAQ 🙂 and Amazon (NASDAQ 🙂 if no global agreement is reached to revise the rules for cross-border taxation by mid-2021.

Efforts by the Organization for Economic Co-operation and Development (OECD) to update the rules for the era of digital commerce ended this year. Donald Trump's administration turned down the prospect of signing a multilateral agreement shortly before the presidential election.

The heads of state and government of the EU will take a look at the situation in March and decide how the bloc should proceed, said the source of the French finance ministry.

"Obviously, March was not chosen by chance. March will be two months after Biden takes office … We hope to have contacts with the new American administration within those two months," the source said.

"Depending on what the Biden government says, the European Council – at the level of EU leaders – will come up with guidelines in March," the source added.

France is urging its EU partners to prepare an EU digital tax in early 2021, which could be applied quickly if talks at the OECD fail again by the middle of the year.

Paris has its own national digital tax but has committed to removing it once an international agreement is in place. The levy was suspended until December that year while negotiations at the OECD were ongoing.

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