San Francisco: Following the footsteps of France, Italy has approved a new tax to be levied on large tech companies, a move that is likely to put more strains on the country’s relations with the US, the media reported.
Passed this week by Italy’s Parliament, the new tax will come into force on January 1, the Wall Street Journal reported on Tuesday.
The tax is similar to the one France implemented earlier this year which has attracted severe criticism from the US.
The digital tax approved by Italy’s Parliament will impose a three per cent levy on some digital revenue for technology companies that make over $831 million in global revenue, including least $6 million in Italy.
According to a report in The Epoch Times, dozens of countries are working on proposals to change corporate tax schemes to capture money from tech firms that have users across the world, such as Facebook and Google’s parent company Alphabet.
In a recent letter to the Organization for Economic Cooperation and Development (OECD), a think-tank of rich economies, Treasury Secretary Steven Mnuchin said that there were concerns about a proposal put forward by some countries.
The US “firmly opposes digital services taxes because they have a discriminatory impact on US-based businesses and are inconsistent with the architecture of current international tax rules, which seek to tax net income rather than gross revenues,” Mnuchin wrote. US President Donald Trump’s administration earlier also condemned France’s tax. (IANS)
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