By Alma Virto, PhD candidate – University of Salamanca
As expected, Spain´s Council of Ministries on 19 October presented a proposal for a new digital services tax on large tech companies.
In line with the European Commission’s proposal for a digital services tax, Spain would impose a tax on three-percent tax on digital firm revenue.
The tax would apply to revenues generated from activities where users play the main role in value creation. It would also only apply to companies with total annual worldwide revenues of €750 million and revenues in Spain of €3 million or more.
The main objective of this tax is to ensure that big tech companies pay tax where they made their income. Therefore, the user must be located in Spain.
Tax would be imposed only on online advertising services, online intermediation services, and on the sale of data generated from information provided by the user.
The proposal excludes from the tax revenues from the sale of goods or services between users, sales of goods or services made on supplier´s website when the provider does not act as an intermediary, and certain financial services.
Spain expects to collect €1.2 million from the new tax.
The government expects this proposal will be passed into law later this year.
Alma Virto
Alma Virto is a visiting researcher at the Institute for Fiscal Studies of Spain and a PhD Candidate at University of Salamanca, Spain.
Alma has been a tax advisor at the Supreme Court of Justice of Mexico, a tax advisor in Spain for companies with investments in Latin America, a Director in the Attorney General's Office in Tax Matters in the Ministry of Finances, and a tax manager at Deloitte Mexico.
Latest posts by Alma Virto (see all)
- Spanish government proposes digital services tax - October 24, 2018
- Spain to propose digital services tax beginning 2019 - May 9, 2018
Alma can be reached at [email protected]
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