FILE PHOTO: Italy's Minister of Economy and Finance Giancarlo Giorgetti attends a press conference during the G7 Finance Ministers and Central Bank Governors' Meeting in Stresa, Italy May 24, 2024. REUTERS/Massimo Pinca/File Photo
ROME (Reuters) - Italy has extended its domestic tax on digital services to small and medium-sized enterprises (SMEs) to try to overcome U.S. objections that the levy is discriminatory, Economy Minister Giancarlo Giorgetti said on Thursday.
Washington has threatened tariffs over unilateral digital taxes in Europe, as they mainly target U.S. tech companies such as Meta Platforms, Google, and Amazon.
Italy in 2019 introduced a 3% levy on revenue from internet transactions for digital companies with annual sales of at least 750 million euros ($809 million) if at least 5.5 million are made in Italy.
Now, as part of the government's 2025 budget, the Treasury plans to remove these minimum conditions, aiming to raise 51.6 million euros on top of the current revenue of 400 million.
Confirming an earlier Reuters report, Giorgetti said that increasing the number of companies forced to pay the tax was aimed at avoiding clashes with Washington.
"This eliminates the 'discrimination' element underlying the U.S. complaint", Giorgetti said.
Sources told Reuters this week that the United States had renewed calls for Italy to repeal its web tax.
During Donald Trump's first term as U.S. president, Washington said it was prepared to counter the Italian levy.
Now that Trump has won a second term, Italy's web tax is likely to remain a sensitive issue for Prime Minister Giorgia Meloni, an Italian government official said.
($1 = 0.9276 euros)
(Reporting by Giuseppe Fonte; Editing by Mark Potter)
