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Italy's proposed 'Web tax' may breach to EU rules

Original version of measures have been watered down

19 December, 17:54
Italy's proposed 'Web tax' may breach to EU rules

(ANSA) - Rome, December 19 - The European Commission said Thursday that Italy's plans to introduce a so-called Web tax to generate fresh inflows into state coffers from Internet companies may contravene European law.

Emer Traynor, spokeswoman for EU Taxation Commissioner Algirdas Semeta, said the measure contained in Premier Enrico Letta's 2014 budget bill was "contrary to the fundamental liberties and the principles of non-discrimination inherent in the (EU) treaties" in his current form.

The Web tax it aims to force companies that advertise products over the Internet in Italy to do so only through companies that have a registered tax presence in the nation. It was changed earlier this week to exclude taxes on the sale of goods online following complaints about the plan, leaving the law applicable to advertising only. As such, companies like Amazon would not be harmed by the measure, though ones like Google, Yahoo Inc, and Facebook Inc will likely face higher taxes locally.