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Austria says 'critical' of sanctions in digital tax row

AFP  |  Vienna 

Austria on Tuesday reiterated its "critical view" of sanctions after the US said it might retaliate against countries that introduce a tax on internet giants such as Google and Facebook.

The United States on Monday threatened to impose tariffs of up to 100 percent on $2.4 billion in French goods in retaliation for a digital services tax that Washington says is discriminatory.

US Trade Representative Robert Lighthizer also warned that the US was considering widening the investigation to look into similar taxes in Austria, Italy and Turkey.

In September, the Austrian parliament approved taxing internet giants five percent of their digital advertising revenue starting next year.

The digital tax targets businesses with an annual worldwide revenue of at least 750 million euros ($830 million), of which at least 25 million euros is earned in Austria.

A spokesman for Austria's Ministry of Digital and Economic Affairs said Vienna took the latest announcement from the US government "seriously".

"In general we have a critical view of sanctions and think they are the wrong way" to deal with trade differences, he said in a statement emailed to AFP.

"Given the current economic climate, Europe and the US should work on a sustainable easing of trade conflicts rather than influencing the mood through reciprocal threats of penalties."

He added that Austrian officials in charge of the topic have been in touch with US government representatives for some time.

The statement added that the tax aimed to create a "level-playing field" for digital and traditional media in Austria.

When he introduced the tax in April, then Chancellor Sebastian Kurz said it aimed to stop the "unfairness" of internet giants who have until now routed sales through subsidiaries in low-tax EU members.

France has warned the United States of strong EU retaliation if it imposed tariffs on French products.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, December 03 2019. 18:35 IST