US suspends tariffs on Britain, India, EU nations in digital tax dispute

The US government announced Wednesday it is suspending for six months any punitive tariffs on Britain, India and four European nations while it works to resolve a dispute over digital services taxes.

“The United States is focused on finding a multilateral solution to a range of key issues related to international taxation, including our concerns with digital services taxes,” US Trade Representative Katherine Tai said in a statement.

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The suspension, which applies to Austria, Italy, Spain and Turkey, comes at the conclusion of year-long investigation into taxes which Washington said discriminated against big US tech companies like Apple, Amazon, Google and Facebook.

But USTR made clear it still had the option to impose the punitive duties on goods from the countries that adopted the taxes.

President Joe Biden’s administration is pushing for a 15 percent global minimum corporate tax that aims to resolve the issue of corporations sheltering profits in low-tax nations.

“The United States remains committed to reaching a consensus on international tax issues through the OECD and G20 processes,” Tai said.

“Today’s actions provide time for those negotiations to continue to make progress while maintaining the option of imposing tariffs... if warranted in the future.”

USTR in January suspended 25 percent tariffs on $1.3 billion in French goods imposed in the digital tax dispute.

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