Saturday, September 18, 2021

US to tax Internet-based Cos. with tariffs, read list of nations to be hit hard

The US is pressing ahead with plans to hit six nations that tax Internet-based companies with retaliatory tariffs that could total almost $1 billion annually.

Goods entering the U.S. — ranging from Austrian grand pianos and British merry-go-rounds to Turkish Kilim rugs and Italian anchovies — could face tariffs of as much as 25% annually, documents published by the U.S. Trade Representative show. The duties are in response to countries that are imposing taxes on technology firms that operate internationally such as Amazon.com Inc. and Facebook Inc.

In each of the six cases, the USTR proposes to impose tariffs that would roughly total the amount of tax revenue each country is expected to get from the U.S. companies. The cumulative annual value of the duties comes to $880 million, according to Bloomberg News calculations.

There have been efforts to replace each individual country’s digital taxes with one global standard — to be brokered by the Organization for Economic Cooperation and Development — but a deal has yet to be reached.

The U.S. says it’s committed to the OECD process, but will maintain its options, including tariffs, in the meantime, USTR Katherine Tai said in a statement on March 26.

The Internet Association — whose members include Amazon, Facebook and Alphabet Inc.’s Google — welcomed the USTR’s move.

Below is a round-up of the tax laws in each country, which goods may be affected, and the date of the virtual USTR hearing.

MUST READ  Harry and Meghan blessed with daughter Lilibet 'Lili' Diana

The U.K.

  • The U.K. applies a 2% tax on the revenues of certain search engines, social-media platforms and online marketplaces.
  • The tax affects companies with digital-services revenue exceeding 500 million pounds and U.K.-specific digital-services revenues exceeding 25 million pounds.
  • The USTR estimates the value of the DST payable by U.S.-based company groups to the U.K. be about $325 million annually.
  • Potentially affected goods include art supplies, make-up and cosmetics, apparel, boat-swings and other fairground amusements.
  • The USTR’s public hearing is set for May 4.

Italy

  • Italy’s DST applies to companies that during the previous calendar year generated 750 million euros or more in worldwide revenue, and 5.5 million euros or more in revenue deriving from the provision of digital services in Italy.
  • The USTR estimates the value of the DST payable by U.S.-based firms to Italy at about $140 million annually.
  • Potentially affected goods include caviar, handbags, suits and bowties.
  • The public hearing is set for May 5.
MUST READ  Online gift shopping on NSW govt's 'Buy Regional' website

Spain

  • Spain charges a 3% tax on certain digital-services revenue related to online advertising services, online intermediary services, and data-transmission services.
  • Companies with worldwide revenue of 750 million euros or more and 3 million euros in certain digital-services revenues are subject to the DST.
  • Initial USTR estimates indicate that the value of the DST payable by U.S.-based companies to Spain will be as much as $155 million annually.
  • Potentially affected goods include shrimp and footwear.
  • The public hearing is set for May 6.
MUST READ  Austin in US has just 6 ICU beds for 2.4 million people as Covid delta cases rise

Turkey

  • Turkey’s DST applies to companies that during the previous calendar year generated 750 million euros or more in worldwide revenues and 20 million lira or more in revenue from providing digital services in the nation.
  • U.S. based companies would pay Turkey about $160 million in taxes annually, USTR estimates show.
  • Carpets, hand-woven rugs and glazed ceramic tiles are among the goods that could be affected.
  • The public hearing is set for May 7.

India

  • India’s DST imposes a 2% tax on revenue of non-resident companies generated from a broad range of digital services offered in the country, including digital-platform services, digital-content sales, digital sales of a company’s own goods, data-related services and software-as-a-service
  • The value of the DST payable by U.S. companies to India will be up to about $55 million annually.
  • Goods affected include shrimp, blinds, bamboo products, gold jewelry and rattan furniture.
  • The public hearing is set for May 10.

Austria

  • Austria’s DST imposes a 5% tax on gross revenue from digital advertising services provided in the country. It only applies to companies with annual global revenue of 750 million euros or more, and annual revenues from digital advertising services in Austria of 25 million euros or more.
  • The DST payable by U.S.-based companies to Austria will be up to about $45 million annually.
  • Leather goods, fabrics, optical telescopes and microscopes are among the products that could be affected.
  • The public hearing is set for May 11.

Latest news

Stay-at-home orders for Hilltops and Glen Innes LGAs

Stay-at-home orders will be introduced for the Hilltops and Glen Innes Local Government Areas (LGAs) from 6pm today (Friday) for seven days due to...

Hayden Quinn’s food show to showcase Western Sydney

Western Sydney’s diverse food and culture, outstanding business owners and natural beauty will star in two upcoming episodes of Taste of Australia with Hayden Quinn on...
MUST READ  Frozen food items imported in March test Covid positive in China's Wuhan

T-Series & Reliance Entertainment to produce over 10 films together

In one of the Indian film industry’s biggest collaborations, T-Series & Reliance Entertainment have joined hands to produce more than 10 films together across...

Free health insurance cover for 15 lakh Punjab families left out of govt schemes

Fulfilling his government’s universal healthcare poll promise, Punjab Chief Minister Captain Amarinder Singh on Friday announced free insurance cover for the 15 lakh families...

Related news

Stay-at-home orders for Hilltops and Glen Innes LGAs

Stay-at-home orders will be introduced for the Hilltops and Glen Innes Local Government Areas (LGAs) from 6pm today (Friday) for seven days due to...

Hayden Quinn’s food show to showcase Western Sydney

Western Sydney’s diverse food and culture, outstanding business owners and natural beauty will star in two upcoming episodes of Taste of Australia with Hayden Quinn on...

T-Series & Reliance Entertainment to produce over 10 films together

In one of the Indian film industry’s biggest collaborations, T-Series & Reliance Entertainment have joined hands to produce more than 10 films together across...

Free health insurance cover for 15 lakh Punjab families left out of govt schemes

Fulfilling his government’s universal healthcare poll promise, Punjab Chief Minister Captain Amarinder Singh on Friday announced free insurance cover for the 15 lakh families...

READ Why Virak Kohli announced stepping down as T20 Captain

India captain Virat Kohli has announced that he will be stepping down as the captain of the T20 team after the T20 World Cup...

Prince Philip’s Will to remain private for 90 years: London High Court

The will of Prince Philip, the late husband of Britain's Queen Elizabeth, will be sealed and remain private for at least 90 years to...

Hole in Earth’s protective ozone layer as big as ‘size of Antarctica’: Scientists

Scientists say the hole in the Earth's protective ozone layer over the Southern Hemisphere is larger than usual this year and already surpasses the...

Construction workers block Melbourne streets over tea room restrictions

Dozens of construction workers have blocked off major roads in Melbourne in protest of the new Covid restrictions placed on tea rooms. Workers took plastic...