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Post By sedna
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sedna
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EU Plans to Add 3% Tax On Tech Giant's Revenue Based on Customers' Location
"Treat equally that which is equal, treat differently that which is different" seems to be the motto of the new EU proposal for increased taxation on tech giants. The proposal, which will be presented just this Wednesday (March 21st), could lead to increased taxation to tech giants that do business with EU customers by as much (or as little, depending on your point of view) as 3% of their gross revenue (the value still isn't final, but should stay within 1% and 5%). It isn't clear how the customer location business will be defined, but it seems that the EU believes its citizens provide increased revenues for companies than other citizens in other parts of the less developed world do.
This move specifically aims to capture real growth and value of digital-first companies, such as Facebook and Amazon. These are types of companies that the EU feels aren't being taxed proportionally (meaning, they currently provide less than they should to public coffers) to the true value they derive from the region. As most EU matters, any tax proposal will need the unanimous approval of all 28 current members before turning into law, so one country alone could block it.
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