Suspend digital taxes, wait for OECD agreement on international taxation: US Treasury Secretary

Urging countries like France to suspend taxes on global computing giants such as Google and Amazon, US Treasury Secretary Steven Mnuchin has asked everyone to wait for a negotiated agreement on international taxation.

As the United States plans to impose tariffs of up to 100 per cent on $2.4 billion in French products over that country's digital services tax, Mnuchin said talks in the Organisation for Economic Cooperation and Development (OECD) are key to resolving the issue.

"We believe that it is very important that these talks reach agreement in order to prevent the proliferation of unilateral measures, like digital services taxes, which threaten the longstanding multilateral consensus on international taxation," Mnuchin said in a letter to OECD chief Jose Angel Gurria on Wednesday.

US Trade Representative Robert Lighthizer released a report slamming France's tax as discriminatory and designed to target American tech giants like Google, Apple, Facebook and Amazon. He said that Washington would proceed quickly with plans to impose tariffs on French products, including champagne, cosmetics, yogurt and Roquefort cheese.

The decision "sends a clear signal that the United States will take action against digital tax regimes that discriminate or otherwise impose undue burdens on US companies," Lighthizer said in a statement on Monday.

The French tax imposes a three percent levy on the revenues earned by technology firms in France, which often come from online advertising and other digital services.

Lighthizer said it his office is considering widening the investigation to look into similar taxes in Austria, Italy and Turkey.