EU Digital Tax Sees Opposition

BRUSSELS – Despite initial support, EU ministers are backing out of support for an international tax on digital companies.

Over the weekend at a meeting of the Finance Ministers of the EU discussed the recent proposal to levy a tax on the revenues major international online businesses.

The taxation of major online businesses, such as Amazon, Google, and Facebook, is a controversial subject in the EU.

Online businesses have been accused of skipping out on their tax obligations by shifting their profits to low-tax jurisdictions.

As a move to balance out the profit-shifting, a proposal has been made to tax the revenues of big online businesses at a rate of 3 percent.

The proposal appeared to have significant support earlier this year, however, at the Finance Ministers backed away from supporting the measure.

The measure saw dedicated opposition from Ireland, and even tentative opposition from Germany, which was one of the original backers of the measure.

If the tax overcomes the mounting opposition and gains EU-wide approval, it could raise as much as EUR 5 billion per year.