WASHINGTON —In testimony given today as part of a U.S. Section 301 Committee hearing on the U.S. Trade Representative’s (USTR) investigation into France’s digital services tax (DST), global tech trade association ITI reiterated the importance of a multilateral solution in addressing reforms to the international tax system.

“Our members rely on clear and established international tax rules to innovate and grow their operations,” ITI stated. “A primary objective for ITI is to ensure a functioning and dependable international tax system. We encourage countries to continue their work toward meaningful solutions.”

In its testimony, ITI highlighted an accelerating trend toward the unilateral adoption of digital services taxes by countries around the world, the impact those taxes could have on the ability of companies to conduct business globally, and the importance of a rules-based, multilateral process for international tax policy developed through the Organisation for Economic Co-operation and Development (OECD).

“Today’s hearing – which centers on the appropriate U.S. policy response to France’s DST – is about more than the French digital services tax,” ITI continued. “It is about preventing the widescale application of targeted, unilateral taxes, which stand to undermine a functioning international tax system and compromise the predictability it has afforded to companies to conduct business globally. Indeed, the significance of this issue goes well beyond tax policy. What is ultimately at stake is whether economies are prepared to do the hard work of developing coherent, collective solutions to complex, cross-border policy challenges, of which there are many in today’s global policy environment.”

ITI underscored its appreciation of USTR’s efforts to investigate France’s DST, while calling for the withdrawal of unilateral tax measures and continued engagement toward a multilateral solution through the OECD process.

ITI continues to engage in the ongoing global work regarding digital taxation and international tax reform. In August, ITI submitted comments to USTR ahead of its first hearing on its Section 301 Investigation of France’s Digital Services Tax. ITI also filed comments on the OECD’s digital tax work in November (Pillar One) and in December (Pillar Two).

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