France says US pulling back on digital tax deal

PARIS: French Finance Minister Bruno Le Maire said Monday that US officials no longer wanted a global deal on taxing multinational technology giants, and that Washington might be preparing penalities over a digital tax implemented by France this year. The OECD is overseeing negotiations among 134 countries to forge a system to make firms pay taxes in the countries they operate, amid growing public anger over tax-avoidance techniques allowed under current laws. France moved ahead with its own digital tax, drawing the ire of US President Donald Trump even though France has vowed to scrub the levy once a global accord is in place.

But on Monday, US Trade Representative Robert Lighthizer is to announce the impacts of the French tax on US companies, and possibly retaliatory measures from Washington. “Having demanded an international solution from the OECD, it (Washington) now isn’t sure it wants one,” Le Maire told France Inter radio. “We can see that the United States is shifting into reverse,” he said, adding that Trump “is going to content himself with imposing sanctions against France over its national tax.

The EU’s incoming single market commissioner, Thierry Breton, also said that US Treasury Secretary Steven Mnuchin could announce Washington’s pullout from the OECD talks. “I understand that we’re going to have a response probably today by Mr Mnuchin telling us that finally it doesn’t work,” Breton told BFM television.