Expressing strong opposition to the imposition of digital services taxes by other countries that discriminate against United States companies.

Subjects: Foreign Trade and International Finance


<html><body><pre>[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H. Res. 268 Introduced in House (IH)]

&lt;DOC&gt;






118th CONGRESS
  1st Session
H. RES. 268

  Expressing strong opposition to the imposition of digital services 
   taxes by other countries that discriminate against United States 
                               companies.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 30, 2023

    Mr. Estes (for himself and Mr. Kildee) submitted the following 
resolution; which was referred to the Committee on Ways and Means, and 
  in addition to the Committee on Foreign Affairs, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                               RESOLUTION


 
  Expressing strong opposition to the imposition of digital services 
   taxes by other countries that discriminate against United States 
                               companies.

Whereas a digital services tax (DST) is a tax levied by a government on a 
        company that provides a digital service to a person or company of that 
        country;
Whereas companies that provide digital services need not be physically located 
        in the countries where the people that use the company's services 
        reside;
Whereas under international income tax and trade agreements, a country's taxing 
        rights over multinational companies' profits are based on a physical 
        presence in such country, rather than the mere sale or use of goods or 
        services in such country;
Whereas certain countries have developed DSTs that deviate from this 
        international income tax system that are discriminatory to United 
        States-based companies, and that threatens the success of United States 
        companies and workers and their competitiveness in international 
        markets;
Whereas many countries, including France, the United Kingdom, Spain, Italy, 
        Portugal, India, and others have already implemented DSTs or similar 
        taxes;
Whereas, on July 10, 2019, the United States Trade Representative initiated a 
        section 301 investigation for France regarding their application of DSTs 
        on American companies;
Whereas, on June 2, 2020, the United States Trade Representative (USTR) 
        initiated section 301 investigations for Austria, India, Italy, Spain, 
        Turkey, and the United Kingdom, regarding their application of DSTs on 
        American companies;
Whereas these investigations resulted in the findings that these DSTs are 
        ``unreasonable or discriminatory and burdens or restricts U.S. 
        commerce'';
Whereas, pursuant to that investigation, the USTR instituted additional duties 
        on selected products from these countries;
Whereas the Organisation for Economic Co-operation and Development (OECD) has 
        hosted multilateral negotiations with 142 countries to propose a 
        framework for permanently removing and replacing DSTs and other harmful 
        measures on a multilateral basis, and that the United States Treasury is 
        participating in those negotiations;
Whereas, on October 8, 2021, as a result of the OECD Pillar One negotiations, 
        ``all parties agreed to remove existing DSTs and other relevant similar 
        measures, and to coordinate the withdrawal of these taxes, and on 
        October 21, 2021, the United States, France, Italy, Spain, and the 
        United Kingdom on a transitional approach to those countries' DSTs prior 
        to entry into force of Pillar 1'';
Whereas pursuant to this framework, the USTR closed its section 301 
        investigations and removed additional duties imposed on these countries;
Whereas DSTs continue to be collected from United States companies in certain 
        jurisdictions;
Whereas unfortunately, other United States trading partners, such as Colombia 
        and Canada, have instituted or threatened DSTs outside of the OECD 
        framework, and potentially in violation of existing trade commitments;
Whereas some countries' efforts have moved beyond DSTs to ``significant economic 
        presence'' policies intended to target, among other things, income from 
        digital transactions and of nonresident digital economy businesses;
Whereas these policies, including DSTs, will discriminate against United States 
        companies and lead to unfair double taxation outside the bounds of 
        current international tax standards; and
Whereas the United States Government currently has many options to oppose DSTs, 
        including intensive bilateral engagement, withdrawal of trade preference 
        programs, World Trade Organization dispute settlement, or imposing 
        duties, fees, import restrictions, or taxes on the goods or services of 
        countries that unfairly target United States companies: Now, therefore, 
        be it
    Resolved, That the House of Representatives--
            (1) is committed to free and fair trade between the United 
        States and other countries;
            (2) agrees with the findings of the reports issued by the 
        United States Trade Representative that conclude that digital 
        services taxes discriminate against United States companies and 
        are in violation of existing international income tax and trade 
        agreements;
            (3) supports the Office of the United States Trade 
        Representative resuming and expanding its investigations into 
        digital services taxes that were suspended as a result of the 
        October 2021 Organisation for Economic Co-operation and 
        Development framework agreement;
            (4) calls on all other countries to cease and desist from 
        implementing any digital services tax, and to immediately stop 
        unfairly targeting United States companies;
            (5) calls on the relevant United States Government agencies 
        to use all available methods and resources to protect United 
        States companies from the discriminatory effects of digital 
        services taxes; and
            (6) supports Congress looking at additional tools to 
        address tax discrimination among United States trading 
        partners, including tax countermeasures.
                                 &lt;all&gt;
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