The U.S. Treasury announced on Friday that the United States and India have extended their standstill agreement on U.S. retaliation over India's digital services tax until Sunday. This move puts the standstill agreement in line with the rapidly approaching deadline for a global agreement to reallocate taxing rights on the largest and most profitable companies in the world.
The Treasury stated in a brief statement that while talks on the "Pillar 1" tax accord are ongoing, a political compromise from November 2021 that was set to expire on March 31 will be prolonged until the end of the month.
Because the United States, India, and China cannot agree on crucial aspects of the pact pertaining to the computation of transfer pricing to assist in determining local tax duties, the Pillar 1 accord is in risk of collapsing.
The discussions in the last minute have a lot on the line. If the agreement falls through, a number of nations may decide to reimpose taxes on US tech companies like Apple, Alphabet's Google, and Amazon.com, risking fines on billion-dollar shipments to the US.
The renewal of the U.S.-Indian agreement coincides with the expiration of such agreements with Austria, Britain, France, Italy, Spain, and Turkey, the other six nations that had implemented digital services taxes.
Following the completion of negotiations to impose a 15% global minimum corporate income tax and reallocate some taxing rights on large multinationals to countries where they sell goods and services, nearly 140 countries struck a two-pillar tax deal in October 2021, following which these countries suspended their taxes on digital services.
The goal was to replace the levies on digital services with this.
Kim Eun-ha and Park Cho-hyeon, two South Koreans, desire to be married and start a family.
Concurrently, while discussions were ongoing, the office of the U.S. Trade Representative consented to postpone intended trade reprisal against the digital taxes.
The Treasury is in charge of leading the US negotiations; a spokesman for the agency declined to comment on the status of the talks.
"As we've said previously, we oppose digital-services taxes that unfairly target U.S. companies and the OECD/G20 Inclusive Framework negotiations offer the best path to address the challenges that digitalization of the economy poses to the international tax system," a USTR spokesperson said, declining to comment further on the next steps.
At a G7 finance conference in May, Treasury Secretary Janet Yellen told Reuters that although negotiations were still ongoing, China and India were impeding an agreement on the alternative transfer-pricing mechanism known as "Amount B."
The finance minister of Italy similarly attributed the failure to reach a consensus on conditions to American pressures. Italy has demanded Google to pay $1 billion in overdue taxes, according to sources who spoke with Reuters earlier on Friday. Italy is also requesting an extension of the U.S. standstill agreement.
(Source:www.reutrs.com)
The Treasury stated in a brief statement that while talks on the "Pillar 1" tax accord are ongoing, a political compromise from November 2021 that was set to expire on March 31 will be prolonged until the end of the month.
Because the United States, India, and China cannot agree on crucial aspects of the pact pertaining to the computation of transfer pricing to assist in determining local tax duties, the Pillar 1 accord is in risk of collapsing.
The discussions in the last minute have a lot on the line. If the agreement falls through, a number of nations may decide to reimpose taxes on US tech companies like Apple, Alphabet's Google, and Amazon.com, risking fines on billion-dollar shipments to the US.
The renewal of the U.S.-Indian agreement coincides with the expiration of such agreements with Austria, Britain, France, Italy, Spain, and Turkey, the other six nations that had implemented digital services taxes.
Following the completion of negotiations to impose a 15% global minimum corporate income tax and reallocate some taxing rights on large multinationals to countries where they sell goods and services, nearly 140 countries struck a two-pillar tax deal in October 2021, following which these countries suspended their taxes on digital services.
The goal was to replace the levies on digital services with this.
Kim Eun-ha and Park Cho-hyeon, two South Koreans, desire to be married and start a family.
Concurrently, while discussions were ongoing, the office of the U.S. Trade Representative consented to postpone intended trade reprisal against the digital taxes.
The Treasury is in charge of leading the US negotiations; a spokesman for the agency declined to comment on the status of the talks.
"As we've said previously, we oppose digital-services taxes that unfairly target U.S. companies and the OECD/G20 Inclusive Framework negotiations offer the best path to address the challenges that digitalization of the economy poses to the international tax system," a USTR spokesperson said, declining to comment further on the next steps.
At a G7 finance conference in May, Treasury Secretary Janet Yellen told Reuters that although negotiations were still ongoing, China and India were impeding an agreement on the alternative transfer-pricing mechanism known as "Amount B."
The finance minister of Italy similarly attributed the failure to reach a consensus on conditions to American pressures. Italy has demanded Google to pay $1 billion in overdue taxes, according to sources who spoke with Reuters earlier on Friday. Italy is also requesting an extension of the U.S. standstill agreement.
(Source:www.reutrs.com)