EPP Group wants to tax digital business where the user is

Commission initiative comes one week after Parliament's proposal to tax tech giants

The EPP Group in the European Parliament welcomes today's legislative proposals to tax digital tech companies such as Google, Facebook and Spotify. "Many internet giants pay less than one percent corporate tax, while European SMEs pay on average 26 percent corporate tax. This blatant injustice towards sincere taxpayers undermines our citizens' trust in Europe's ability to defend their rights in a globalised world. This must stop", said Manfred Weber MEP, Chairman of the EPP Group.

"When Google shows an ad to someone in France or Facebook uses the data of a Polish user, then these companies are doing business in these countries. We want them to pay taxes where the economic activity is", said Alain Lamassoure MEP, who in recent months steered a proposal through the parliamentary process to tax tech giants. This proposal was adopted by a vast majority last week, on 15 March.

"The fact that technology crosses national borders does not mean that digital companies have the right to choose where they pay taxes. They need to pay the taxes where they carry out their activities and proportionally to those activities, which is where the users are", Lamassoure continued.

Lamassoure rejects the claim that the initiative targets US companies first. "Nonsense! A fistful of dollars from the Americans? Let’s leave this one for fans of spaghetti westerns! The economy of the 21st century is largely based on the valorisation of immaterial assets like patents, copyrights, royalties, trademark rights, licences, etc. Traditional ways to tax these can lead to injustice", explained Lamassoure.

The EPP Group will carefully examine the two draft laws the European Commission proposed today and make sure that a short-term solution doesn't hamper the long-term harmonisation of the corporate tax base across Europe.