“Europe must lead digitalisation – not penalize it”

This is a debate article. The opinions expressed are the writer’s own.

DEBATE. Now it’s time to release the plans for the digital tax, say Jörgen Warborn and Matilda Ekeblad (both M).

It’s time to pick up the pace to make Europe a leader in the digital age. Today, unfortunately, the EU is lagging behind both the United States and China. The regulations are outdated, the bureaucracy is too restrictive and the business climate is far from satisfactory for us to really be able to take advantage of the possibilities of digitalisation. The biggest threat, however, is the far-reaching plans for a digital tax in the EU. The introduction of a European digital tax or fee would be a historic mistake.

Digitization and artificial intelligence contribute to a fantastic societal development. The digital sector, for example, has been singled out as most important for restarting the economy again after the pandemic. In healthcare and the pharmaceutical industry, technology can help save lives. For the climate, this means new conditions for reducing emissions and restructuring the industry. The development streamlines working life and private life, transport and logistics. And the list of areas where digitization and AI generate societal benefits can be made much longer.

Even if Sweden has a prime minister who does not even shop online, the Swedish people feel all the more ready for digitalisation. Almost eight out of ten Swedes say that they welcome digitalisation and believe that it contributes to a better society. For those of us who have the opportunity for a connected life, it is now almost as obvious a part as having access to electricity.

If development is to continue to be driven forward, concrete political initiatives are needed to improve the business climate, expand the IT infrastructure, increase cutting-edge knowledge and ensure that we have regulations that promote innovation and ensure access to data.

In stark contrast to this are concrete plans for the introduction of a digital EU tax. Something that would put a wet blanket over the digital sector.

All new taxes at EU level are in principle problematic, but a digital tax is particularly poorly thought out. The reasons for this are several:

  • Slows down digitization. Anyone who has seen the long and arduous process from IT engineers’ writing pads to a finished digital product understands how hard a tax would hit. There is hardly a single successful digital service that has not involved millions of kronor in development costs, which has caused years of losses in the company. Introducing a targeted tax on the sector would therefore set off the legs of potential future digital successful companies and hinder new start-ups. Society would therefore risk losing much of the value that digitalisation creates.
  • Affects small businesses. About 40 percent of small and medium-sized companies sell their goods and services online and thus risk being indirectly affected by the tax, through higher prices to use the platforms they need. European companies are already facing a steady stream of bureaucracy and are burdened by increasing tax pressures at national level. They are not served by additional burdens.
  • Europe would continue to lag behind. The signal that the tax sends is that Europe is not the place for those who want to be successful in the digital sector. Innovative entrepreneurs and growing companies will look across the Atlantic or towards Asia in search of a better business climate. A special tax in the EU would also give countries such as the USA, India and China great competitive advantages. This will only make Europe even more dependent on foreign internet giants.

The European Commission is not alone in its desire to proceed with the introduction of a digital tax. Therefore, special efforts are now required to ensure that the tax does not become a reality. Ultimately, it is the member states that own the issue and individual countries can put a stop to tax proposals.

Now the plans for the digital tax must be scrapped. Europe must lead digitalisation, not penalize it.

Jörgen Warborn, EU-parliamentarianiker (M)

Matilda Ekeblad, union president of the Moderate Youth Union

Source: Nyteknik – Senaste nytt by www.nyteknik.se.

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