A joint statement was issued by the United Kingdom, France, Italy, Austria and Spain chest The cancellation of the Digital Services Tax (DST) was announced on Thursday.
This comes after an agreement with the five countries and the Treasury Department in conjunction with the Organization for Economic Cooperation and Development on the definitions of Article 301 related to the tax on digital services. In the canceled agreement, European countries will implement the current “unilateral measures” during the transition period.
The Section 301 tax will affect the French, Austrian glassware and cosmetics exchanges in the UK. The press release also referred to the transition period. The additional requirement for one year after Pillar 1 goes into effect requires the states concerned to add any additional Pillar 1 tax to the portion of the corporate income tax payable.
Full implementation of DST in a global tax deal will take effect in 2023. However, countries are expected to maintain unilateral DST measures until then. The United States Trade Representative (USTR) aims to work with the five governments to oversee implementation of the agreement. The USTR investigation began in June 2020 and initially involved other countries such as India and Turkey, but they chose not to join the agreement.
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