Spain are Risking their Relationship with the US After Approving Digital Tax

Officials all across the world are now trying to grapple with ways to try and tax companies such as Facebook and even Google. Spain’s own government have just approved a digital services tax. This is coming after a very similar move came from the US.

The levy is going to place a total tax rate of 3% on earnings that come from online ads and any deals that might be brokered on digital platforms.

The budget minister who is Maria Jesus Montero has stated that the tax is not going to come into place until December and that this is going to allow the organisation for Economic Corporation and Development to come to an agreement on a separate global tax.


Big Tech is Just the Beginning

Washington threatened to impose very high duties on French products. This included leather handbags and even wines.

This came after Paris introduced their very own digital tax last year. Both sides have agreed to some kind of global framework and this is going to come under the aegis of OECD. At the end of the day, Spain cannot really afford to have a tax system that is still stuck in the last century.

They need to try and move forward and they also need to try and take on a brand-new form of activity as well. When you look at the online slots market, you will soon see that this is not going to be taxed and that there are going to be certain industries which are targeted.

Officials Around the World

Officials all across the world are now grappling with ways to try and tax big companies. They often report having profits because they are able to operate in a low-tax jurisdiction. This includes Ireland and even Luxembourg.

The issue with this is that it enrages other governments. Montero has stated that the criteria to apply the tax did not discriminate when you look at the type of business and that they are going to do everything they can to make the whole system fair.


Britain have plans to try and proceed with the digital tax even though it has a huge potential impact on their intention to have a deal past Brexit.

They want to try and forge a deal with the US but doing this could cause problems. Spain are hoping to raise over €968m every year in tax and this is all going to come as a result of the levy. In addition to this, they are going to impose a tax on finance restrictions as well.

The cabinet approved the formation of the two taxes, but the bills happened to die before they were even discussed in parliament.

The main reason for this is because the prime minister had to call a snap election after they were unable to pass a budget. Of course, only time will tell what the future is going to hold but either way, this tax is set to benefit the country.

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