PARIS, March 12 (Reuters) - The U.S. government is looking at how to respond to plans by governments such as France and Britain for taxes specifically targeting digital companies, a senior U.S. Treasury official said on Tuesday.
France and Britain as well as Italy and Spain are pushing ahead with plans for such taxes at the national level after EU countries failed to reach an agreement for the bloc as a whole.
Other countries outside the EU such as Australia are also planning such taxes in the absence of a broader reform of international tax rules to account for the rise of big digital companies such as Apple, Google and Facebook .
Chip Harter, the U.S. Treasury’s top international tax official, said such unilateral taxes were “ill conceived” and that it was better to pursue broader international tax reform at the Organisation for Economic Co-operation & Development (OECD).
“The challenges facing the international tax system are just far broader than how to tax social media and search engines,” Harter told journalists in Paris before talks at the OECD, a club of mostly wealthy nations, later this week.
The emergence of digital giants has pushed international tax rules to the limit because they can book profits in countries with the lowest taxes no matter where the customer is, which some countries like France say is unfair.
“The United States opposes any digital services tax proposals whether they be French or UK,” Harter said.
“What we have seen of the most recent French proposals, we view them as highly discriminatory against U.S. businesses ... Various parts of our government are studying whether that discriminatory impact would give us rights under trade agreements, WTO, treaties,” he added.
Global reform of international tax rules have been debated for years but progress has been slow in the face of widely varying national interests.
A new push is under way at the Paris-based OECD after nearly 127 countries and territories agreed in January that any revision of global tax rules should tackle some of the most vexed issues, such as how to divide up the right to tax digital firms’ cross-border income between countries.
Speaking in a public session of a meeting of EU finance ministers, Romania’s Eugen Teodorovici said EU governments will focus on trying to reach a common position over the OECD-led overhaul.
If that reform were delayed beyond 2020, the EU could restart talks for its own tax, after they foundered because of the opposition of some governments in the 28-nation bloc. (Reporting by Leigh Thomas; Additional reporting by Francesco Guarascio; Editing by Alison Williams)