April 30, 2019 / 1:12 PM / a year ago

UPDATE 1-Czech finance ministry plans 7 pct rate for new digital tax

(Adds details on the Czech tax, EU disagreement)

PRAGUE, April 30 (Reuters) - The Czech Finance Ministry said on Tuesday it was finalising a plan to tax global internet giants and would submit a proposal by the end of May for a 7 percent rate.

The ministry said the tax would be aimed at selected internet services, mainly advertising. It said the tax could become effective around mid 2020 and conservative estimates showed the tax adding 5 billion crowns ($219 million) annually to state budget revenue.

There is still disagreement among European Union members over how to implement a so-called "GAFA tax" - named after Google, Apple, Facebook and Amazon - to ensure they pay a fair share of taxes on their massive business operations in Europe.

"The digital tax will apply to the most significant global players and is a reaction to the failure of solving this (issue) on the European Union level," Finance Minister Alena Schillerova said. "The debate is not whether to implement the tax, but since when, in what shape and what level."

The Czech tax would apply to targeted advertising placed on a digital interface by companies with a certain level of global turnover. The tax would also apply to sales of data gathered from the tech firms' clients, the Finance Ministry said.

The Czech rate would surpass the 5 percent announced by Austria, an increase from 3 percent previously.

Germany has been pushing for a minimum level of corporate taxation globally.

$1 = 22.8600 Czech crowns Reporting by Jason Hovet and Robert Muller; Editing by Alison Williams and Mark Potter

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