EU wants internet taxes from “BIG Internet Companies”.
Germany sees big problems, however, and several countries fear retaliation from the United States, where most of the Internet giants come from.
The levy is intended to address the problem that digital corporations such as Google, Apple, Facebook and Amazon pay significantly less tax in Europe than traditional companies. The reason is that they are not physically present in the countries of their European customers with branches whose profits could be taxed.
As an international company, you quickly get to the point where you set up a taxable business location in Germany abroad. It is important to understand that this permanent establishment is not created by the will to establish a permanent establishment, but is founded on actual action. This raises the questions: “When is there a tax liability for foreign companies in Germany?” and: “How can I check whether I am taxable in Germany?”
Of course, a permanent establishment abroad is not always desired, since it is bureaucratic and often involves higher costs. That is why we want to deal more fully with the tax obligations of foreign companies in Germany.
The guidelines for the taxation of international companies can be found in the bilateral agreements to avoid double taxation of income and assets. The framework for the agreement of the bilateral double taxation agreements is the OECD model agreement, the main purpose of which is to regulate the problems and contractual arrangements of the OECD member states as uniformly as possible. On the basis of this framework, the special features of the bilateral agreements must be taken into account for each country, which of course would go beyond the scope of such a contribution.
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