Home / SmartTech / Europe will make it on its own in reforming digital taxes in 2021 if it has to, says EU President, as the block provides EUR 150 billion in COVID-19 relief for cloud, AI and broadband

Europe will make it on its own in reforming digital taxes in 2021 if it has to, says EU President, as the block provides EUR 150 billion in COVID-19 relief for cloud, AI and broadband



Europe will propose its own digital tax early next year if there is no global agreement on how to update tax rules for the internet age, EU President Ursula von der Leyen said today, reiterating the bloc’s determination not to reform the tax admit speech on the state of the Union before the European Parliament.

“We will spare no effort to reach an agreement within the framework of the OECD and G20. But there is no doubt that if an agreement fails to establish a fair tax system that will generate sustainable income in the long term, Europe will come up with a proposal early next year, ”she told MEPs.

In the far-reaching speech, in which the 2020s were also called for as the “digital decade” of Europe, von der Leyen committed the bloc, one fifth (EUR 1

50 billion) of the EUR 750 billion coronavirus support fund announced earlier this year spend on digital investments.

“There has never been a better time to invest in European tech companies as new digital hubs are growing everywhere from Sofia to Lisbon to Katowice,” she said. “We have the people, the ideas and the strength as a Union to be successful. And that’s why we’re going to invest 20% of NextGenerationEU in digital. “

“We are reaching the limits of what we can do in an analogous way. And this great acceleration is just beginning. We have to create the digital decade in Europe, ”added von der Leyen.

“We need a common plan for digital Europe with clearly defined goals for 2030, such as B. Connectivity, Skills and Digital Public Services. And we have to follow clear principles: right to privacy and connectivity, free speech, free flow of data and cybersecurity.

“But Europe must now be the digital leader – or it must follow the path of others who set these standards for us. So we need to move fast. “

Under the rousing rhetoric of “digital sovereignty”, the speech did not offer much that was new in terms of technology policy – but the EU President confirmed that there will be updates to European competition rules and regulations for the use of AI next year.

The Commission is currently debating whether a new competitive tool is needed to respond to digital network effects that can lead to tipping markets, as well as an upcoming law on digital services (not directly mentioned in the speech). .

“In terms of personalized data – business to consumer – Europe was too slow and is now dependent on others,” she said. “This cannot happen with industrial data. And here is the good news that Europe is at the forefront – we have the technology and, crucially, the industry. “

“We unveiled our new industry strategy in March to ensure the industry can lead the double green and digital transition. The past six months have only accelerated this change – at a time when the global competitive landscape is fundamentally changing. Because of this, we will update our industry strategy in the first half of next year and adjust our competitive framework, which should also keep up, ”she said.

Technical Investment Priorities

Priorities for digital investment highlighted by her are the plan to build a European cloud based on the federated GaiaX data infrastructure that develops common requirements for EU-wide data exchange. (This is part of a large Commission industrial data reuse project announced earlier this year.)

The second investment focus mentioned was artificial intelligence. The EU President highlighted the potential of the technology to deliver innovations such as “precision farming in agriculture, more accurate medical diagnosis and safe autonomous driving”. However, she also stressed the importance of having rules to bypass the technology and reiterated EU lawmakers’ belief that a framework is needed to ensure what they refer to as “human-centered” AI.

Earlier this year, the EU published a white paper with proposals to regulate high-risk artificial intelligence applications. However, the final form of the proposal will have to wait until 2021.

Von der Leyen also suggested that lawmakers look for ways to give consumers more control over how their data is used in the era of big data-based AI.

“We want a set of rules that puts people first. Algorithms must not be a black box and there must be clear rules when something goes wrong. The Commission will propose a law next year, ”she said today.

“This includes control over our personal information that [we] still far too seldom today. Every time an app or website asks us to create a new digital identity or simply to log in through a large platform, we have no idea what is happening to our data in reality. “

To that end, she said the Commission wanted to develop “a secure European electronic identity” that EU citizens could use anywhere on the bloc – “to do everything from paying your taxes to renting a bike”. It would be “a technology that allows us to control what data and how data is used,” she added, addressing her topic of digital sovereignty.

The Commission is currently reviewing the existing rules on eID, including holding a consultation that is expected to end next month. There, obstacles to the use of eID and trustworthy services are examined and considerations are made as to how the framework for a “digital identity of the EU” can be further developed.

It now sounds like lawmakers have concrete plans to revise eID – with the aim of promoting a proprietary digital authentication mechanism that can help advance the broader strategy of digitizing and reusing data.

The third focus of the digital editions for “COVID-19 aid” is on infrastructure, with a focus on broadband access.

“The investment boost from NextGenerationEU is a unique opportunity to drive [broadband] Extension to every village. For this reason, we want to focus our investments on secure connectivity, the expansion of 5G, 6G and fiber optics, “said von der Leyen, adding:” NextGenerationEU is also a unique opportunity to develop a more coherent European approach to connectivity and digital infrastructure deployment . “

Her speech also highlighted a planned EUR 8 billion investment in the development of next-generation supercomputers. And repeated demands on European industry to develop their own next-generation chips – “with this we can use the increasing volume of data in an energy-efficient and secure manner”.

“None of this is an end in itself – it is about Europe’s digital sovereignty on a small and large scale,” she added.

Green Deal

Von der Leyen also spends a lot of time with the environment and the risks associated with climate change.

The European Green Deal is expected to account for a larger proportion of COVID-19 aid spending than digital projects – although there is likely to be some overlap when von der Leyen talks about “a world where we are using digital technologies to build a healthier one, greener society ”.

She said 37% (€ 277 billion) of the NextGenerationEU fund will be spent directly on Green Deal targets.

These expenditures are likely to give electric cars a significant boost by investing in the charging infrastructure. Other priorities she mentioned are hydrogen, which replaces coal for industrial production; and adapting the construction industry to make it more sustainable and environmentally friendly, including through the use of AI and smart technologies.

“NextGenerationEU should invest in European flagship projects with the greatest impact: hydrogen, renovation and 1 million electric charging stations,” she said. “I want NextGenerationEU to create new European hydrogen valleys to modernize our industries, power our vehicles and breathe new life into rural areas.”

“Our buildings cause 40% of our emissions. They need to become less wasteful, cheaper and more sustainable, ”she added. “And we know that the construction sector can even be converted from a carbon source to a carbon sink if organic building materials like wood and smart technologies like AI are used.”

The systemic change required to support a full transition to a circular economy has been termed a ‘new cultural project for Europe’.

“Every movement has its own appearance. And we have to give our systemic change its own aesthetic – in order to reconcile style with sustainability, ”she said and announced a plan to build a“ new European Bauhaus ”- also known as a“ Co-Creation Space, in which architects, Artists, students, engineers and designers work together to make this happen. “


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