Under pressure from the US, Spain postpones the collection of the Google fee to December
The Government plans to approve one of its star tax projects: the digital services tax, known as the Google rate. Spain thus takes the lead in the negotiations led by the OECD to design a global tax. But, in the face of pressure from the US, which has threatened tariffs on countries that tax its technology, it postpones the payment at the end of the year, when the OECD plans to have its proposal ready. "It is not a suspension of the tax, but simply a liquidation at the end of the year," Vice President Nadia Calviño said Monday. The Executive is also expected to approve the rate on financial transactions.
The Google fee, whose payment should be split quarterly, will be paid exceptionally this 2020 at the end of the year, as the economic vice president Nadia Calviño advanced on Monday in Brussels. The reason is not trivial. The Google rate is a tribute that is at the center of the international debate and on the radar of several countries. It aims to make large platforms such as Google or Facebook tax in countries where they do business instead of diverting profits to territories with low taxation. Its implementation is, however, being complicated due to the threats of the United States, the headquarters of the world's leading technology companies, to impose tariffs on those who tax the activity of their companies.
Washington's challenge has reached the heart of the EU, which it has threatened with new commercial rates on cars if it continues with its digital tax project, which is currently standing after negotiations between member states have failed.
In the case of France, intimidation has taken effect: Paris launched the tax, and even collected it, but given Donald Trump's threat of applying 100 tariffs on products such as wine he decided to freeze payments until the end of the year . Spain thus joins the French initiative: it approves a national tax, but hopes to get into the car of a global rate. The French route "may be a model for Spain," admitted the Minister of Foreign Affairs, Arancha González Laya.
This calendar aligns with OECD plans, which studies how to change international fiscal rules in the face of globalization and the rise of the digital economy. The agency has been working on a proposal for months that will agree with the 137 jurisdictions - including the US - that participate in the initiative, and expects to have a global Google rate ready by the end of 2020. According to its estimates, this tax would allow to collect some 100,000 million dollars (about 92,000 million euros) per year.
At the moment, the debate within the OECD revolves around two proposals: that large corporations — not only technological ones, in a nod to the United States — pay tribute wherever their users are; and that a global minimum corporate tax rate be set to discourage the diversion of benefits to territories with more advantageous tax rules.
Spain has shown that it is favorable for the OECD or the EU to take the lead in the design of a digital rate, but at the same time it has made it clear that it would move forward with its own tax in the event that global negotiation fails. "We are working at the international and European level, but without giving up moving forward at the national level," Calviño said Monday, reports Lluís Pellicer.
The Minister of Finance, María Jesús Montero, had already announced last week that the two regulatory projects on which the Google rate and the Tobin rate are governed - which are not approved via Budgets for being newly created - were ready and about see the light. The Government presented the bills before the Cortes last year, but they declined after being put on duty by the early call for elections on April 28.
Sources of Finance assure that the norms that will foreseeably be approved this Tuesday would almost totally trace the texts that were presented last year. The Google rate will have a rate of 3 that will be applied to digital companies that invoice more than 750 million euros in the world and whose income in Spain is greater than three million. The text presented in 2019 defined three taxable events in which the participation of users was decisive for the creation of value, and that due to its breadth they would end up affecting not only technological: advertising aimed at users of a digital interface (website, technological platform, software or social network); provision of platforms that allow users to locate other users to trade with them (the paradigmatic case is Amazon) and the sale or transfer of data collected from users of a website or platform.