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USTR Tariffs: US announces new delayed tariffs against six countries in response to taxes targeting big tech companies

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The six countries subject to tariffs, which are set at 25% on goods worth about $2 billion, include Austria, India, Italy, Spain, Turkey and the United Kingdom. The USTR said the additional duty would be prevented from taking effect for 180 days while the US continues negotiations on a proposed global tax regime through the Organization for Economic Co-operation and Development and the G20 process.

Foreign governments have long complained that big tech companies like Apple, Facebook and Google should pay them more in taxes. Some have recently passed taxes targeting revenue generated by such companies, including Facebook, Google and Amazon based in the US.

For example, the United Kingdom imposes a 2% tax on revenue from social media platforms, search engines and online marketplaces, arguing that because these companies profit from UK-based users, the UK is entitled to a share of those profits. .

“The application of existing corporate tax rules to businesses operating in a digital economy has resulted in a misalignment between the place where profits are taxed and the place where value is created,” The UK government has said.

America’s response to digital services taxes reflects its opposition to discriminatory policies targeting large, successful Silicon Valley companies with global reach. In March, the USTR proposed an estimated $880 million in combined new tariffs against the six countries, amid an investigation into foreign taxes under Section 301 of the Trade Act of 1974.

The final tariff figure, affecting more than $2 billion in goods, included imported products including shrimp, carpets, cosmetic items, clothing and video game consoles, among other things.

“The United States remains committed to reaching a consensus on international tax issues through the OECD and G20 processes,” US Trade Representative Catherine Tai said in a statement. “Today’s action provides time for those negotiations to continue to progress, while retaining the option to impose tariffs under Section 301, if necessary in the future.”

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