Finance ministry to tax Google, Facebook for ads

 Germany’s finance ministry is looking into the possibility of a 15 per cent special tax on online advertising revenue collected by foreign internet companies such as Google or Facebook from German operators, Wirtschaftswoche magazine reported on Friday.

The ministry was in the early stage of studying such a move, the weekly publication added.

This move could entail treating payments for online advertisements in the same way as license fee payments, which would make the German companies subject to withholding tax being deducted.

The German companies, which choose to place online advertisements, will have to recover this withholding tax from the internet firms as the revenue would be their original tax liability, the report said.

The detour via German customers would be necessary because the tax system has no access to platform operators based abroad.

The finance ministry had confirmed the plans, but stressed there was no agreement on how to proceed between federal finance authorities and individual states, the magazine reported.