The end of an investigation does not mean that of the threat of tariffs. The Biden administration announced on Friday, March 26, that it had ended the investigations targeting Brazil, the Czech Republic, the European Union (EU) and Indonesia in the context of the litigation over the taxation of digital companies.
These four jurisdictions were under investigation under the Trump administration because they planned to implement a digital tax but in the absence of such a levy, the Biden administration decided to end to the procedure.
On the other hand, the United States Trade Representative, Katherine Tai, has indicated that she could retaliate by resorting in particular to tariffs against Austria, the United Kingdom, India, Italy, Spain and Turkey as part of the investigations launched by his predecessor in the Trump administration, Robert Lighthizer.
Willingness to achieve international consensus
“The United States is committed to working with its trading partners to resolve concerns about taxes on digital services and to address broader international tax issues.”, commented Katherine Tai quoted in the press release.
“The United States remains committed to reaching an international consensus within the framework of the OECD process [Organisation de coopération et de développement économiques] on international tax matters. However, until such consensus is reached, we will maintain our options under the so-called Section 301 procedure, including, if necessary, the imposition of tariffs ”, she clarified.
These investigations began in June 2020. In January, the Trump administration, just before handing over power to Joe Biden and his team, decided not to take any specific action although the investigations concluded that the digital taxation envisaged by the jurisdictions concerned discriminated against American companies.
