Large companies with significant digital revenues in the European Union could face a 3% tax on their turnover under a draft proposal from the European Commission seen by newsagency, Reuters.
The proposal, expected to be adopted next week and still subject to changes, has been modified from an earlier draft which put the planned corporate rate between 1 and 5%.
The tax, if backed by EU states and lawmakers, would only apply to large firms with annual worldwide revenues above €750 million and annual "taxable" revenues above €50 million in the EU.
It would mainly affect multinationals such as Google and Facebook.
Other large US firms such as Uber, Airbnb and Amazon could also be hit by this new levy that would apply across the 28 EU countries.
Big tech firms have been accused by large EU states of paying too little tax in the bloc by re-routing some of their profits to low-tax member states like Ireland and Luxembourg.
While an earlier version of the draft seen by Reuters mentioned several companies, the latest proposal contained no such references.
Services that will be taxed are digital advertising, which would capture both providers of users' data like Google, and companies offering ads space on their websites like popular social platforms such as Facebook.
The tax is presented in the draft as a temporary measure that would only be implemented if no deal is found on a more comprehensive solution which would tax the digital profits of companies in the countries where they are made, rather than where the firms are headquartered as is the case now.
The new tax would be levied by the countries where the digital users are located.
If they live in different EU countries, "the tax base will have to be distributed in either member states according to some allocation keys," the draft document says.
For instance, revenues resulting from the supply of digital advertising should be allocated to countries in proportion to the number of times an advertisement has been displayed on a users' device there.
