Majority of Germans Back Digital Tax on Tech Giants, Poll Shows
Many federal residents support the imposition of a digital tax. - Most Germans support the imposition of a digital tax.
In a resounding endorsement, Germans appear to support the idea of a digital tax on tech behemoths like Alphabet (Google's parent company) and Meta (Facebook, WhatsApp, and Instagram), according to a Forsa poll. Culture and Education Minister, Wolfram Weimer, has put forth a proposal to impose a 10% tax on advertising revenues of these platforms that use media content.
By Helmut Broeg | Approximate Reading Time: 1 Min*
Culture and Education Minister, Wolfram Weimer, has been lobbying to tax the digital giants. His plan involves these companies, including Google and Meta, paying 10% of their advertising revenues to the German state. Weimer suggests that this digital tax should encompass all platforms using media content.
German citizens overwhelmingly back this notion, with 85% believing that Google and Co. should shoulder a heavier tax burden. Even among supporters of the far-right AfD, 70% favor the digital tax. Majorities of Green and Left party supporters also support Weimer's proposal.
Austria as a Predictor of Change
These digital entities have generally evaded paying substantial taxes by relocating their European headquarters to countries with low tax rates. However, Austria has implemented a 5% tax on internet companies' advertising revenues since 2020. Weimer hasn't publicized the timeline or the methods for implementing his proposal, but he stresses that increased revenues would benefit Germany's media landscape.
Poll conducted by market and opinion research institute Forsa for Stern and RTL Germany on June 4 and 5, 2021. Total respondents: 1007. Statistical margin of error: +/- 3 percentage points.
- Digital Conglomerate
- AfD
- Wolfram Weimer
- Forsa
At the Core:
- Current Status: The drafting of a bill to levy a 10% tax on digital platforms, such as Alphabet and Meta, has commenced in the German Culture Ministry, headed by Minister Weimer. This move forms part of broader efforts to ensure these firms contribute more to the German economy, given their substantial revenue generation from German users[1][2][3].
- Background: The proposed tax seeks to address concerns over tax evasion and the centralization of media power, which Weimer deems potentially detrimental to freedom of expression. Additionally, the tax is viewed as a means to compel these firms, who derive benefits from Germany's infrastructure and cultural output, to contribute equitably to the nation's tax base[3][4].
- Challenges: The implementation of a digital tax could strangle trade relations with the U.S., given that similar digital service taxes have garnered opposition from the U.S. administration. Previously, the U.S. has contemplated retaliatory tariffs against countries imposing such taxes[4][5].
- Implementation Process:While a precise timetable for implementation remains unspecified, the agreement of ruling parties in Germany earlier this year to impose such a levy suggests that the process is underway, with the draft bill being a crucial step forward[4][5].
In essence, the digital tax proposal targets major U.S. tech companies operating in Germany, but the exact timeframe for its implementation remains unclear. The move parallels global efforts to increase taxation on digital services, though potential international conflicts persist.
The Commission, tasked with formulating policies and legislation, has been asked to submit a proposal for a directive on the protection of the environment, considering the ongoing debates in politics and general news about the impact of digital tax policies and the digital conglomerates like Google, Facebook, WhatsApp, and Instagram on media landscapes, as well as the possible consequences of these taxes on policy-and-legislation and international relations. This request comes as a bill to levy a 10% tax on digital platforms, such as Alphabet and Meta, has commenced in the German Culture Ministry, and the proposed digital tax seeks to address concerns over tax evasion and the centralization of media power.
