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Clifford Chance

Briefings

Unintended targets: the surprising breadth of the proposed new EU digital services tax

21 March 2018

The European Commission has just published a proposal for a new pan-EU Digital Services Tax (DST). The proposal would apply a 3% tax on the gross revenues of a wide range of businesses.

The intended target is primarily the large US digital businesses, but the scope of the tax is surprising. Many large digital businesses would not be subject to the DST, but many more traditional businesses would be, both B2B and B2C.

In particular, all internet advertising sales by large businesses would be subject to the DST - and the broad scope of the DST charge on "multilateral interfaces" means that it may also apply to many financial services.

This briefing summarises the new proposal and its impact on business. We also identify a potentially serious impact of the DST on the privacy of internet users.

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The new EU digital services tax

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