Opponents of European digital services taxes may have lost one avenue of attack after Europe’s highest court ruled that progressive revenue taxes aren’t discriminatory.
The Court of Justice of the European Union ruled Tuesday in two cases—involving Hungarian subsidiaries of Vodafone Group Plc and Tesco Plc—that Hungarian measures that taxed bigger companies more heavily than smaller ones weren’t discriminatory, even if they ended up mostly hitting foreign companies.
The judgments may have dealt a blow to companies hoping to challenge the growing number of digital services taxes such as those imposed or being considered in France, Italy, Spain, and the Czech Republic. Those measures have included revenue thresholds, so that they apply only to the largest tech companies. That often means foreign companies—many of them American—bear the brunt of the tax.
Source Bloombergtax
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