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Digital tax: Paris judges "unacceptable" the US proposal to the OECD


Digital tax: Paris judges "unacceptable" the US proposal to the OECD

Paris (AFP)

The American proposal for an "optional solution" for digital taxation is "unacceptable," Friday French Finance Minister Bruno Le Maire, calling on the United States, which threatens Paris customs sanctions, to resume "good faith "the discussions at the OECD.

In a letter to the Organization for Economic Co-operation and Development (OECD) on Thursday, US Treasury Secretary Steven Mnuchin reiterated his support for the ongoing negotiations to reach a global agreement by June on the taxation of digital businesses .

But he has also put forward a proposal based on the "safe harbor regime" ("fallback solution"). According to a source close to the negotiations, the term hides a principle of "optionality" allowing multinationals to choose between the system currently in force or that which would be concluded at the end of the debates at the OECD.

"The American proposal to have an optional solution, where companies would freely choose whether or not to be taxed, quite frankly I do not believe too much (...) an optional solution, obviously, would not be acceptable either by France nor by its partners of the OECD ", reacted Friday Bruno Le Maire.

"I have not seen many companies that freely accept to be taxed, we can always count on the philanthropy of each, but I'm not sure that in terms of public finances, it leads very far", has continued the minister, inaugurating a forum of fashion industries in Bercy.

The draft text to the OECD "must be obviously binding for all companies," he insisted, calling the United States "resume the thread of negotiation (...) in good faith, not on a optional base, but on a binding basis for all States that would sign this agreement. "

These international negotiations are complicated because of hardening between Paris and Washington, the United States denouncing the introduction in France of a national tax on the digital giants.

In retaliation, the Trump administration threatened Monday to overtax "up to 100%" the equivalent of $ 2.4 billion of French products, including champagnes, cheese, cosmetics and leather goods.

"It is unfortunate that these trade wars are now leading our American friends and allies (...) to directly attack the products that symbolize our French culture," said Le Mayor, ensuring that French taxation "n is not discriminatory ".

The French minister said he obtained "the full support" of EU Trade Commissioner Phil Hogan to "work on all possible response options" in case the US sanctions materialize.

© 2019 AFP

Source: france24

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