Spain delays collection of ‘Google tax’ amid US pressure

The decision now puts Spain in the lead international negotiations headed by the Organisation for Economic Co-operation and Development (OECD) worldwide with the view of putting in place a global "digital services tax". [Shutterstock/Lloyd Carr]

The Spanish Council of Ministers approved on Tuesday (18 February) a national digital services tax known as the “Google tax”, as well as financial transactions tax, EURACTIV’s partner EuroEFE reported.

The decision now puts Spain ahead in the international negotiations headed by the Organisation for Economic Co-operation and Development (OECD) worldwide, with the view of putting in place a global “digital services tax”.

However, after pressure from the US, which has threatened several times in the past to impose new tariffs on the EU if such a tax is passed, the Spanish coalition executive decided to postpone the collection of an estimated €1.8 billion until December, EFE reported.

“It is not a suspension of the tax [“Spanish Google tax”], but only a delay in its collection until the end of the year,” Finance Minister Nadia Calviño told Spanish Media on Tuesday (18 February).

Also read: MADRID – Spain to pass ‘Google’ and ‘Tobin’ national taxes

The OECD is expected to submit its own proposal on a global “digital tax” also in December 2020.

The so-called “Google tax” is at the centre of the international debate. It aims to make large digital platforms as Google or Facebook pay taxes in the countries where they actually operate and do business, instead of using tax havens to benefit from lower taxation, and thus diverting their fiscal obligations.

However, its implementation is very complex, mainly due to threats from the US, home of the world’s largest tech companies.

On Tuesday, Spain’s progressive coalition government (socialists of PSOE and leftists of Unidas Podemos/United We Can) also gave its green light to a “Spanish Tobin tax”, a tax on financial transactions being implemented in the Iberian country.

(Edited by Sarantis Michalopoulos)

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