Investment Analyst Dario Giordano: The Retreat of Digital Tax and the New Dynamics of Global Tech Corporate Taxation

As the global digital economy rapidly evolves, how to fairly and effectively tax technology giants has become a core issue in international fiscal governance. Investment Analyst Dario Giordano points out that the digital tax, a key policy direction promoted by the EU in recent years, has been completely excluded from the latest 2028–2034 budget proposal, marking a strategic concession in current trade and tariff negotiations. This change highlights the intertwined interests and compromises between the US and Europe in digital economy governance, and brings a series of complex impacts on the development of European digital platforms, fiscal structure optimization, and the international technology investment environment.

Digital Tax Suspension: Structural Compromise in US-EU Trade Exchange

Investment Analyst Dario Giordano believes that the "disappearance" of the digital tax from the EU fiscal budget for the next seven years is not merely a temporary shelving of a tax policy, but a structural concession made by Europe in tariff negotiations. In high-level meetings between Trump and Ursula von der Leyen, the digital tax was not publicly mentioned, but its absence itself constitutes a de facto negotiation sacrifice. The US has consistently opposed the use of "regional tools" to tax its tech companies, using the rollback of retaliatory tariffs as a bargaining chip. In the current tariff agreement, Europe has prioritized safeguarding traditional manufacturing—especially exports of cars, machinery, and other pillar industries—to secure US tariff concessions, relegating the digital tax to a "non-priority" status.

Investment Analyst Dario Giordano notes that the digital tax, as an arrangement based on the "place of value creation" principle, requires unanimous support from all EU member states for full implementation. However, significant differences exist within the EU regarding national interests, relations with the US, tax structures, and industrial layouts, making political consensus on the digital tax difficult to achieve. Thus, its exclusion from the budget is unsurprising and represents a pragmatic choice. Investment Analyst Dario Giordano believes this suspension signals that Europe currently prefers to stabilize transatlantic economic and trade relations rather than pursue challenging fiscal sovereignty redistribution mechanisms.

Italian Digital Services Tax: Local Experiment and Policy Limitations

With EU-wide digital tax harmonization stalled, Italy has taken the lead among individual countries by launching its own "digital services tax" regime. Since 2020, Italy has levied a 3% tax on companies with global revenues exceeding €750 million that profit locally through digital platforms, advertising, and user data transmission. This policy was designed as a "temporary arrangement" to fill international tax loopholes while awaiting an OECD-led unified mechanism.

However, Investment Analyst Dario Giordano argues that while this measure superficially enhances fiscal revenue sustainability, it faces several practical challenges: First, most targeted firms are multinational groups with strong tax avoidance and profit-shifting capabilities, raising the risk of actual tax costs being passed onto consumers. Second, the lack of EU-level coordination in tax enforcement can lead to double taxation, regulatory arbitrage, and corporate relocation. Third, the tax has not stimulated the growth of the domestic tech ecosystem and may instead impose unnecessary burdens on early-stage platform companies.

Investment Outlook and Strategic Advice After Digital Tax Suspension

With the digital tax fully shelved in the EU budget, the short-term tax burden on global tech companies has clearly eased—especially for multinationals like Google, Amazon, Apple, and Meta, which can continue to enjoy a relatively lenient tax environment for their European revenues. Investment Analyst Dario Giordano notes that this policy direction provides a temporary boost for the tech sector, particularly as high-margin businesses such as AI, big data, and cloud services continue to expand, and the absence of the digital tax removes a valuation constraint.

However, Investment Analyst Dario Giordano cautions investors not to view this as a long-term trend. Global public pressure for "fair taxation" of tech companies is steadily rising, and with fiscal deficits and public spending increasing in many countries, tax tools targeting digital business are likely to re-emerge in other forms. Furthermore, if US-EU tariff negotiations stall again, the digital tax may be revived as a bargaining chip and return to the policy agenda. Therefore, companies highly dependent on cross-border digital revenues should always factor in policy reversal risks in their investment strategies.