US proceeds with $1B retaliatory tariffs on nations with digital taxes
The logos of mobile apps Facebook and Google displayed on a tablet in Lille, France, Oct. 1, 2019. (AFP Photo)


Washington is moving ahead with plans to impose retaliatory tariffs on six nations, including Turkey, which adopted digital services taxes, a report said Monday.

The retaliatory tariffs could amount to around $1 billion (TL 8.13 billion) annually, Bloomberg reported, citing documents published by the U.S. Trade Representative (USTR).

The body back in January criticized India, Italy, Turkey, the U.K., Spain and Austria over the taxes which it said discriminate against U.S. companies and are inconsistent with international tax principles.

The countries are imposing taxes on online giants, including Google, Amazon, Facebook and Apple amid efforts to make U.S. multinationals pay a larger share of their revenues in taxes in the countries where they operate.

Goods including Austrian grand pianos, British merry-go-rounds, Turkish carpets, hand-woven rugs and Italian anchovies could face up to 25% tariffs per year, the report said.

The USTR proposes levies that would approximately total the amount of tax revenue each of the six nations is estimated to obtain from the U.S. companies.

According to Bloomberg News calculations, the cumulative annual value of the duties comes to around $880 million.

With the law that went into effect in March last year, Turkey applies a 7.5% tax to revenues on digital advertising and content

The tax includes all manners of online advertisements and services that allow any digital content to be listened to, watched or downloaded.

The tax applies to companies generating 750 million euros ($882.1 million) or more in global revenues and TL 20 million ($2.46 million) or more in revenues in Turkey from covered digital services.

The USTR estimates show U.S.-based companies would pay Turkey around $160 million in taxes per year, according to Bloomberg.

The USTR is seeking public comments on its plans to go ahead with the tariffs and will hold public hearings at the start of May.