Single digital market will help European tech ‘losers’

Google and other US-based internet companies are likely to be taxed by the European Union, as part of a new plan that aims at build a single digital market across the region.

The search giant is likely to be taxed for showing copyright material.

However, European Commission Digital Economy & Society commissioner Günther Oettinger said ‘taxing is an option but not the decided solution’.

The Wall Street Journal reported Oettinger as saying that Europe is presently a ‘loser’ in the information-technology sector, but the scenario could change with investment and creation of a level playing field for all digital companies.

Copyright rules need to be framed to suit the 21st century, and need to replace the existing national laws that were forged ‘in an era of gramophone records and music-hall composers’.

The commissioner also criticised US companies for entering Europe through member states where data protection rules were flawed, allowing the companies to gather data from the whole of EU.

He proposed create a single set of European rules to protect personal data.

Previously, Germany was planning to tax Google for showing snippets from large German newspapers, but the search giant stopped showing the snippets.

French authorities claim that Google owed them €1bn for shielding revenue from local taxation.

Oettinger said that without improving protection of intellectual-property rights, there will be no next generation of creative producers.

"Then they have to work with Shakespeare and Goethe."

The region is also facing competition in the automotive sector due to the introduction of connected cars.

WSJ quoted Oettinger as saying: "It is a really challenging question."

To get ahead of Silicon Valley, European auto makers should "integrate Google and Apple and Facebook services but not be overtaken by them, to create the next generation of cars."

"My expectation is that our European car producers are able, are willing to survive."

"They say Google, Apple and Facebook are invited — but not to have them take over, to have a clear partnership where our European companies are in the lead."