ROME (Reuters) – Italy is preparing for a new tax on digital businesses in the 2020 budget, when the search for alternative sources of income that allow for the cancellation of a planned increase in the sales tax, two coalition sources told Reuters on Monday.
FILE PHOTO: Men walk past the corporate headquarters of Google, in the king’s Cross area, in London, Britain, on August 14, 2019. (REUTERS photo/Hannah McKay
The levy will require a multinational, web-based giants will pay a 3% tax on transactions made over the internet, the sources said, adding that some of the changes were the result of negotiations among the governing parties.
The plan is the expected return on investment of approximately 600 million euros per year, and will apply to businesses with an annual turnover of up to the value of at least eur 750 million and for services of more than € 5.5 million in Spain.
The plan is largely in line with the proposals made by the Paris-based Organisation for Economic co-operation (OECD) last week called on the government to set new rules for the taxation of the global giants.
Rome is searching for funds to avoid a hike in the sales tax with a value of approximately € 23 billion ($26 billion) as a result of the kick-in from January, which could hurt the already weak domestic demand.
The result of the anti-establishment 5-Star Movement and the centre-left Democratic y, to submit the draft budget to the European Commission by the Jan. 15.
In italy and other European Union members have long complained about the way in which Facebook, Google and other web giants, and collect huge profits in their country of residence and pay tax on the profit of a few million euros per year.
The big internet companies have been pushing the tax rules to the very limit if they are able to change the order of the income to a low – or non-tax places like Ireland, regardless of where their customers are.
Italy’s original plan for web of tax in 2018, according to the previous result of a 5-Star rating, and the right-wing League), but that the government had in August this year, and the tax was never implemented.
The new system will be rolled out in January, the sources said. It will operate on a self-assessment tax regime, which allows businesses to submit an estimate of the amount that is owed. This is going to be subject to any controls by the Italian authorities.
If the European Union succeeds in order to the introduction of a common set of rules for a web load over the entire 28-nation bloc, Italy and adapts its plan accordingly, they can be added.
Rome has asked the European Commission to make a proposal for a minimum tax for companies operating in Europe, the Minister of Economy, Roberto Gualtieri, told a parliamentary hearing on Nov. 8.
Reporting by Giuseppe Fonte, Editing by Gavin Jones and Catherine Evans