Germany considers 10% tax on internet giants

Germany is weighing plans for a 10 percent digital tax for internet giants such as Alphabet and Meta, a senior official said Friday, despite the risk of stoking further trade tensions with the United States.

"This is a question of tax justice," parliamentary state secretary in the digital ministry Philip Amthor told Die Welt newspaper.

"Large digital corporations in particular are cleverly engaging in tax avoidance" while German businesses are "treated with no mercy, everything is taxed."

"A fairer system must be created here so that this tax avoidance is addressed," he said about the plan to tax advertising revenue from platforms such as Meta's Instagram and Facebook.

Germany's media and culture commissioner Wolfram Weimer said earlier the government was drafting a proposal for such a digital tax but would first invite Google and other big tech companies for talks.

Weimer -- the former editor of Die Welt and other media -- on Thursday told Stern magazine that "the large American digital platforms like Alphabet/Google, Meta and others are on my agenda".

He said he had "invited Google management and key industry representatives to meetings at the chancellery to examine alternatives, including possible voluntary commitments".

"At the same time, we are preparing a concrete legislative proposal," Weimer added.

This could be based on the model in Austria, which has a five percent tax, he said, adding that in Germany "we consider a 10 percent tax rate to be moderate and legitimate".

He said that "monopoly-like structures have emerged that not only restrict competition but also over-concentrate media power. This puts media diversity at risk".

"On the other hand, corporations in Germany are doing billion-dollar business with very high margins and have profited enormously from our country's media and cultural output as well as its infrastructure.

"But they hardly pay any taxes, invest too little, and give far too little back to society."

Weimer stressed that "something has to change now. Germany is becoming alarmingly dependent on the American technological infrastructure."

Source: AFP