October 25 2021

US Treasury Announces Agreement on Transition From Digital Services Tax to New International Tax Framework

Source: IBFD Tax Research Platform News

The US Treasury Department (Treasury) has announced that the United States, Austria, France, Italy, Spain and the United Kingdom reached an agreement on the transition from existing digital services taxes (DSTs) to the new multilateral solution that was agreed on 8 October 2021 by 136 countries of the OECD-G20 Inclusive Framework (IF).

The Treasury made the announcement in its Press Release, dated 21 October 2021.

The Press Release states that the agreement represents a pragmatic compromise that helps ensure that the named countries can focus their collective efforts on the successful implementation of the IF's historic agreement on a new multilateral tax regime and allows for the termination of trade measures adopted in response to DSTs.

The Press Release further states that, overall, this political agreement carefully balances the perspectives of several countries and is yet further demonstration of their commitment to working together to reach consensus, and to deliver far-reaching multilateral reforms that help support national economies and public finances.

According to the Press Release, the named countries will continue to discuss this matter through constructive dialogue.