Austria: Digital Services Tax
By Edith Huber-Wurzinger, Gaedke & Angeringer Steuerberatung GmbH
Austria presses ahead with a new tax on advertising service of internet giants after plans for an EU-wide levy fell. From the beginning of 2020, therefore, Austria will tax firms like Google, Amazon, Facebook, and Alibaba, 5% of their advertising revenue from within Austria.
Currently, only advertising in print media, radio, on television, or on panels in public areas is subject to the Austrian advertising tax. In order to consider the ongoing worldwide digitalisation, the Digital Services Tax (DST) is now intended to also cover online advertising services. The EC proposed an EU directive on such a digital services tax back in March 2018, but the EU member states failed to reach an agreement. Therefore, some member states plan to introduce such a tax on a national level. In Austria, the DST will be introduced as of 01 January 2020.
Austria’s brand-new Digital Tax Law (it passed the legislative process by the end of September this year) introduces a 5% flat tax on Austrian digital-advertising revenue for groups with worldwide revenues of at least EUR 750 million and Austrian digital advertising revenue of at least EUR 25 million. The person rendering online advertising services in Austria against consideration is liable to pay the DST. If another person contributes to such services, this person is liable for the DST to the extent of the contribution.
Examples for covered online advertising services include advertisements that are displayed in search engine results or banners on a website. However, only domestic services will be subject to DST. An online advertising service is deemed to be provided in Austria if:
- It is displayed on a user’s device with an Austrian IP address and
- The content of the advertisement is (also) addressed to domestic users.
The tax debtor is obliged to keep records of all services that are subject to DST and of the respective basis for calculating the tax for seven years. As this includes private data of the users, the new tax also raises significant constitutional and privacy concerns.
Edith Huber-WurzingerGGI member firm
Gaedke & Angeringer Steuerberatung GmbH
Advisory, Auditing & Accounting, Tax
T: +43 316 3279 40 819
Gaedke & Angeringer Steuerberatung GmbH in Graz, Austria, offers professional support on all issues pertaining to taxation, accounting, business management, social security, and labour law and uses stateof- the-art technology and a strong base of knowledge to advise clients of every legal structure and from all economic sectors.
Edith Huber-Wurzinger is an Austrian certified tax consultant. Her focus is in the field of indirect taxes and international taxation. She is a member of the VAT working group of the Expert Committee for Tax Law of the Austrian Chamber of Tax Advisors and Auditors, and a specialist author and lecturer.
Published: Indirect Taxes Newsletter, No. 09 Autumn 2019 l Photo: Have a nice day - stock.adobe.com