Treasury Secretary Steven Mnuchin and French Finance Minister Bruno Le Maire on Sept. 3 stated a shared commitment for their countries to work constructively on a solution to international taxation at the Organization for Economic Cooperation and Development (OECD) by early 2020, Treasury announced after the officials met in Washington, DC.
The commitment comes after the Office of the U.S. Trade Representative (USTR) started a Section 301 investigation that could result in tariffs on some goods from France if the agency finds the country's digital tax framework to unfairly impact U.S. commerce.
On the final day of the G7 summit in Biarritz, France, Aug. 26, French President Emmanuel Macron said his country will abandon its digital services tax when an international tax is imposed on digital services, at which point everything paid under the French tax system will be reimbursed.
The French in July signed into law a 3% tax that applies to firms with annual global revenues from digital services of at least 750 million euros and annual revenues from France of at least 25 million euros. The tax is set to take effect in November.
The U.S. and France potentially could progress toward a deal during the upcoming October G20 meetings in Okayama, Japan.
Cathy Schultz, the National Foreign Trade Council's vice president for tax policy, said in an email that she expects the G20 in October will be asked to endorse an outline for a multilateral agreement on international taxation.
Schultz added that if the G20 approves the outline, the OECD will ask for its approval at the January meeting of the OECD Inclusive Framework (IF) on Base Erosion and Profit Shifting (BEPS), a multilateral group including all 36 OECD members and 96 non-OECD members interested in BEPS issues.
"The rest of the year will be spent actually working out the details of that proposal — which will take some time to put together," she said.
Treasury didn't immediately respond to a request for comment.
Image Sourced from Google
See more from Benzinga
- Attempt To Smuggle 53 Pounds Of Meth Results In Arrest At Arizona Port Of Entry
- Freight Futures Daily Curve: 9/4
- Steep Rise In Recorded Supply Chain Thefts In EMEA Region
© 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.