The European Commission wants to impose a 3% tax on tech companies who make money from user data or digital advertising in a country, regardless of their brick-and-mortar presence. Apart from social media platforms, online marketplaces like Airbnb and Uber can also be affected.
The current system taxes companies on profits where there are headquartered.
European leaders will discuss the plans at an EU summit on Thursday, opening a debate about how to capture revenue from digital firms.
France has led the charge for a digital tax, sometimes nicknamed the Gafa tax, after Google, Apple, Facebook and Amazon. Smaller countries, such as Ireland, Luxembourg and Estonia, fear unilateral EU action could hand an advantage to the US, Japan, or even Brexit Britain.
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