Austria to press ahead with digital tax

Vienna - Austrian Chancellor Sebastian Kurz vowed Saturday to press ahead with a tax on large internet and technology companies, following France's example, as the European Union struggles to finalise a new EU-wide levy.

France, which is pushing for a new so-called "GAFA tax" - named after Google, Apple, Facebook and Amazon - is advancing with its own tax from January 1 to ensure the global giants pay a fair share of taxes on massive business operations in Europe.

"It is only fair that internet giants in Europe pay a proper amount of tax," Kurz said, according to a statement. "In addition to a EU-wide move, we'll also act on a national level. We will introduce a digital tax in Austria."

Kurz said that EU member states "agree in principle that there is a need for such a tax."

He said Finance Minister Hartwig Loeger was in the process "of working out the details and their implementation and will unveil the basic framework at the beginning of January."

The tax would then come into force as part of the government's planned tax reforms in 2020.

"The aim is clear - to tax companies that generate huge profits online, but pay hardly any tax on them, such as Facebook or Amazon," Kurz said.

In addition to taxing direct sales, France will also require the companies to pay a levy on advertising revenues, websites and the resale of private data, French Finance Minister Bruno Le Maire announced earlier this month.

Under EU law, US technology titans such as Google and Facebook can choose to report their income in any member state, prompting them to pick low-tax nations like Ireland, the Netherlands or Luxembourg.

Such firms, on average, pay a 9% levy, compared to 23% for other businesses, according to Margrethe Vestager, the EU competition commissioner.

The low tax rates have caused anger among voters in many European countries, but the 28-member bloc is divided on how to tackle the issue.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For only R75 per month, you have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today.
Subscribe to News24
ZAR/USD
16.46
(+0.21)
ZAR/GBP
21.33
(+0.24)
ZAR/EUR
19.48
(-0.22)
ZAR/AUD
11.61
(+0.34)
ZAR/JPY
0.16
(+0.28)
Gold
1907.17
(+0.24)
Silver
24.62
(+5.30)
Platinum
872.00
(+2.22)
Brent Crude
42.85
(-0.67)
Palladium
2405.00
(+3.19)
All Share
55271.75
(+0.20)
Top 40
50851.62
(+0.22)
Financial 15
9956.35
(-0.22)
Industrial 25
75567.07
(+1.08)
Resource 10
53788.16
(-0.63)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
Yes, and I've gotten it.
32% - 19 votes
No, I did not.
43% - 26 votes
My landlord refused
25% - 15 votes
Vote