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The US abandoning the safe harbor requirement of digital tax creates an opportunity for global agreement

via:CnBeta     time:2021/2/27 5:07:45     readed:263

The United States has abandoned a key requirement in the negotiation of digital tax for technology companies, eliminating an important factor that has led to the tension in trade relations between Europe and the United States and hindered the conclusion of an international agreement.Treasury spokesman said Treasury Secretary Janet Yellen said at the G20 virtual meeting that the United States no longer requires the so-called safe harbor rule, which allows U.S. companies to choose not to pay taxes abroad.

The spokesman said Yellen said the United States will now actively negotiate on the issue and the global minimum tax rate.

Negotiations on tax reform in some 140 countries around the world were blocked last year when the trump administration insisted on a safe harbor system. Most other countries say that they do not accept this tax option.

There is still a long way to go to reach a global agreement on digital tax. Apart from the issue of safe harbor, the United States and Europe have always had differences on the scope of the new regulations. In addition, the issue of profit distribution in different jurisdictions, how to ensure and implement tax certainty and other issues remain unresolved.

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