Treasury Secretary Steven Mnuchin testifies before a Senate Appropriations subcommittee on Capitol Hill in Washington, May 15, 2019.
Jonathan Ernst | Reuters
Treasury Secretary Steven Mnuchin warned one of the globe’s largest economic organizations of the consequences international taxes could have on American business and voiced opposition to the recent introduction of digital services taxes.
In a letter to the Organisation for Economic Co-operation and Development, Mnuchin said the U.S. objects to digital services taxes because they “have a discriminatory impact on U.S.-based businesses.”
“We have serious concerns regarding potential mandatory departures from arm’s-length transfer pricing and taxable nexus standards — longstanding pillars of the international tax system upon which the U.S. taxpayers rely,” Mnuchin wrote in a letter obtained by CNBC.
“We urge all countries to suspend digital services tax initiatives, in order to allow to OECD to successfully reach a multilateral agreement,” he added.
Mnuchin’s letter to OECD Secretary-General Jose Angel Gurria comes a day after President Donald Trump exchanged barbs with French President Emmanuel Macron for the country’s new digital-services tax, which was signed into law in July.
The French tax imposes a 3% tax on revenues tech companies generate in France, including targeted advertising and digital marketplaces. In response, the White House on Monday said it could impose duties of up to 100% on $2.4 billion in imports of French champagne, cheese and other luxury goods.
“Look, I’m not in love with those companies — Facebook and Google and all of them, Twitter. Though I guess I do well with Twitter,” Trump said Tuesday from a NATO summit in London. “But they’re our companies, they’re American companies. I want to tax those companies. They’re not going to be taxed by France.”
“I’m not going to let people take advantage of American companies. Because if anyone’s going to take advantage of the American companies it’s going to be us,” he added. The U.S. president has joined other world leaders in the U.K.’s capital city to mark the 70th anniversary of NATO.
— CNBC’s Kayla Tausche contributed reporting.