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EU proposes new tax on U.S. tech companies' revenue

Photo: Emmanuel Dunand / AFP / Getty Images.

The European Commission will vote next week on a proposed 3% tax on digital revenues of large tech companies such as Google, Facebook and Amazon that do significant business abroad. Digital advertising and gig economy services would be within the scope of the tax, per a draft of the proposal obtained by Reuters.

Why now: EU states have criticized some U.S. tech firms for avoiding taxes there by housing profits in states with low tax rates, such as Ireland.