The European Commission, the European Union’s executive arm, says tech companies use the profit-shifting method to reduce their tax burdens. In documents obtained by The New York Times before Wednesday’s announcement, officials estimated that digital businesses in the bloc pay an average effective tax rate of just 9.5 percent, compared with 23.3 percent for traditional businesses. Minimum thresholds, however, will mean that only large tech businesses will be subject to the tax, and companies will be able to deduct the payments from their corporate tax contributions to avoid double taxation. Ireland — which is in a dispute with the European Commission over its tax treatment for Apple — quickly voiced opposition to the new plans on Wednesday. Facebook is one of several companies that have been in the cross hairs of regulators in Europe over the mishandling of personal data, tax avoidance and antitrust violations.

Source: New York Times March 21, 2018 16:26 UTC