ROME (Reuters) – Italy is expected to be the implementation of a planned internet tax” will be in 2020, allowing for digital businesses to pay a 3% tax on the volume of transactions on the Internet, the Minister of Economy, Roberto Gualtieri, said on Tuesday.
A FILE PHOTO of Italian Minister of Finance, Roberto Gualtieri, looks on during his swearing-in ceremony at the Quirinale presidential palace in Rome, Italy, September 5, 2019 at the latest. REUTERS/Ciro de Luca/File Photo
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 at the most.
For digital companies to shift profits to low-or no-tax locations such as Ireland and by international treaties to protect them from paying taxes in the countries in which they do not have what is referred to as a “permanent establishment”.
“The income is to be taxed where they are made,” Gualtieri told a parliamentary hearing.
In Rome on Tuesday, including a production in partnership with Italy’s largest commercial broadcaster Mediaset, Netflix’s Chief Executive and founder, Reed Hastings, said that the AMERICAN video streaming service is planned to open offices in Italy and pay taxes in the country.
The Italian web tax 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 people.
The measure was originally to come into effect in 2019, before being pushed back to next year. It will have to be carried out by means of a decision of the central government.
The Treasury is expected to be in December, and that the web of tax on the revenue of 600 million euros in revenue by the year 2020.
Gualtieri also said Italy had asked the European Commission to come forward with a proposal to have a minimum impact on businesses.
The EU Commissioner for Economic Affairs-designate Paolo Gentiloni, a former Italian prime minister, has said that it intends to monitor the efforts made by the EU in order to harmonise the corporate tax rate in the 28-nation bloc.
He also said that the european union will be the introduction of a tax on services, even in the absence of a global agreement on a web-based income tax.
Editing by Mark Heinrich