Four EU States Want Google To Pay Tax On Revenue, Not Profit
Four European Union states – France, Germany, Italy and Spain – have proposed that large multinational tech companies (like Google and Apple) should pay European taxes on revenue, not just profit.
In a letter, the ministers remarked:
“We should no longer accept that these companies do business in Europe while paying minimal amounts of tax to our treasuries.”
The letter and its proposal have been signed by the respective finance ministers of each EU state. Sources state the letter was sent to the European Union’s Estonian presidency, with a copy made for the group’s Executive Comission.
France is reportedly leading the bid, which seeks to remedy tax avoidance from such large companies – a move which has received significant support from other nations who are frustrated by the somewhat small amount of taxes such large companies are paying under the existing rules.
Represented by their finance ministers, the four states have asked the EU to develop a solution so an “equalisation tax” on turnover could result in corporate tax being paid in the EU, being the same as in the country where the funds were earnt.
The ministers state they will present their proposal to their EU colleagues at a meeting planned for the 15th & 16th of September.
Reportedly on the EU presidency’s agenda is discussing a way to make it possible for firms to be taxed in the country where it creates value, and not simply where they are a resident for tax purposes.
The proposal follows recent news, wherein the European Union ordered Apple to repay A$19.7 billion in back taxes from last year. It also ruled that several deals Apple made in Ireland were illegal.
In February, Apple appealed against the decision.
In July, Google successfully won a case in France against a €1.2 billion tax bill, as a court ruled the company had not abused tax loopholes to avoid paying tax.