US signs interim agreement with 5 countries on digital service tax | America signs interim agreement with 5 countries on digital service tax – Bhaskar

digital desk, Washington. The US has announced to reach an agreement with Austria, Britain, France, Italy and Spain on the Digital Services Tax (DST) during the interim period ahead of the implementation of the Organization for Economic Co-operation and Development (OECD) global tax agreement.

The OECD, the Organization for Economic Cooperation and Development, announced in July that more than 130 countries and jurisdictions are in a two-pillar framework to reform international corporate taxation rules, Xinhua news agency reported on Friday. which has recently been endorsed by the G20 financial leaders.

The so-called pillar framework aims to reallocate certain tax rights on multinational enterprises from their home countries to the markets where they have business activities and from where they make profits. It is an attempt to settle the long-standing battle between the United States and European countries over DST.

“In coordination with the Treasury, we will work closely with these governments to ensure the implementation of the agreement and rollback of existing DST,” US Trade Representative Catherine Tai said in a statement.

We will also continue to oppose the unilateral implementation of digital services taxes by other trading partners, he added.

According to the statement, under the circumstances defined under the deal, the digital services tax liability that US companies accrue during the interim period will be creditable for future income tax earned under Pillar One under the OECD agreement.

In return, the US would eliminate the currently suspended additional tariffs on goods from the five countries that were adopted in the DST Section 301 investigation.

The other two countries under the DST investigation, Turkey and India, have not joined the deal, the statement said.

(IANS)

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