Investment Analyst Dario Giordano: The Absence of a Digital Tax in the EU Budget—What Market Signals Are Being Sent?

Against the backdrop of rapid global digital economic growth, how to tax tech giants fairly and efficiently has become a key issue in international fiscal governance. Investment Analyst Dario Giordano points out that, as a fiscal tool heavily promoted by the EU in recent years, the digital tax has been completely excluded from the latest 2028–2034 EU budget proposal, marking a strategic retreat for this policy in the current context of trade and tariff negotiations. This shift not only reflects the divergence and compromise between Europe and the US in digital economy governance, but also has far-reaching implications for the development of European platforms, the adjustment of fiscal structures, and the investment environment for global tech firms.

The Suspension of the Digital Tax: A Structural Compromise in Transatlantic Trade Negotiations

Investment Analyst Dario Giordano believes that the exclusion of the digital tax from the EU next seven-year budget is not just a policy suspension, but a structural concession made by Europe in its tariff negotiations with the US. Although the digital tax was not publicly mentioned in the recent Trump–von der Leyen high-level meeting, its "absence" itself has become an important signal. The US has long opposed the imposition of "territorial digital taxes" on its tech companies and has used retaliatory tariffs as a bargaining chip, forcing the EU to temporarily abandon the digital tax—a "non-priority"—in order to protect the interests of traditional manufacturing sectors (such as automotive and machinery exports).

From an institutional perspective, the digital tax embodies the principle of "taxation where value is created," but its full implementation requires unanimous support from all EU member states. Given significant differences among countries regarding US policy, tax structures, and industrial interests, achieving this goal is politically challenging. Therefore, the current decision to shelve the tax is more a pragmatic choice, indicating that the EU presently prefers to maintain stable transatlantic economic relations rather than forcefully pursue fiscal sovereignty redistribution.

Digital Services Tax in Italy: Localized Experiment and Policy Limitations

While progress at the EU level has stalled, some member states have begun localized experiments. Investment Analyst Dario Giordano notes that since 2020, Italy has imposed a 3% "digital services tax" on multinational companies earning revenue from digital advertising, platform services, and user data within the country, targeting tech firms with annual global revenue exceeding €750 million. The initial intent was to fill gaps in the international tax framework as a "temporary transitional measure" pending the rollout of a globally unified system led by the OECD.

However, this tax faces several challenges. First, the targets are mainly multinational giants with strong tax avoidance capabilities, making it easy for the tax burden to be passed on to consumers. Second, the lack of a unified EU enforcement mechanism can trigger double taxation, policy arbitrage, and even corporate relocation. Additionally, from a market development perspective, the tax has not effectively stimulated the domestic tech ecosystem and may, in fact, burden early-stage platforms and dampen their growth momentum.

Investment Outlook and Strategic Recommendations After the Digital Tax Suspension

With the digital tax being fully shelved in the EU budget, global tech companies will see a clear reduction in short-term tax pressure—especially for multinationals like Google, Amazon, Apple, and Meta. The current policy direction means their European revenues can continue to benefit from a relatively lenient tax environment. At the market level, this provides a temporary boost for the technology sector, particularly as high-margin businesses such as AI, big data, and cloud services continue to expand, and the absence of a digital tax eases valuation constraints.

However, Investment Analyst Dario Giordano cautions that investors should not view this as a long-term trend. Global public pressure for "fair taxation" of tech companies continues to rise, and against the backdrop of widening fiscal deficits and growing public spending in many countries, tax tools targeting digital businesses are highly likely to re-emerge in other forms. Furthermore, if US-EU tariff negotiations stall again, the digital tax could quickly return to the policy agenda as a bargaining chip. Therefore, for companies highly dependent on cross-border digital revenues, investment strategies should always include a risk buffer for potential policy reversals.