Dispute over digital taxes: USA threatens retaliatory tariffs

Dispute over digital taxes: USA threatens retaliatory tariffs
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Dispute over digital taxes


US threatens retaliatory tariffs

The fact that US Internet companies do business around the world but hardly pay taxes in most countries is a thorn in the side of many countries. Some states have therefore introduced special digital taxes. That, in turn, is a thorn in the side of the US government.

The US government is increasing the pressure on Great Britain and five other countries in the dispute over digital taxes for American tech companies such as Alphabet, Amazon and Facebook. The US trade representative Katherine Tai announced retaliatory tariffs of 25 percent on goods valued at more than two billion dollars. However, they should initially be suspended for six months in order to find an international negotiated solution during this time.

The USA is threatening Great Britain and India as well as Austria, Italy, Spain and Turkey with higher import barriers on certain of their export goods. Specifically, if there is no agreement, additional tariffs of 25 percent each should be levied. In the case of Britain, for example, it is about clothing, jewelry and cosmetics. Based on import data for the 2019 calendar year, the US government puts the scope of the affected goods here at around $ 887 million.

Italy is threatened with higher tariffs on perfume, handbags and ties, here the volume amounts to around 386 million dollars. Spain would have to cope with significantly higher export barriers for goods worth 324 million dollars, with Turkey it is 310 million, with India and Austria 118 and 65 million respectively.

According to Tai, the US hopes to be able to resolve the digital tax conflicts with the help of the OECD and the G20. In March, the Office of Trade Representatives ended investigations into possible discrimination against US companies by the European Union, Brazil, Indonesia and the Czech Republic, so that there is no longer any risk of increased tariffs.

There is still a dispute with France. Here the USA had already announced punitive tariffs on products worth around 1.3 billion dollars, but these were initially suspended in the hope of a coordinated international solution.

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Author: Killian Jones
Graduated From Princeton University.He has been at the USTV since 2017.
Function: Chief-Editor
E-mail: admin@ustv.online

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