Germany Wants to Make Amazon, eBay Liable for Vendor Sales Tax

(Bloomberg) -- Germany is considering tightening legislation to hold the likes of Inc. and eBay Inc. accountable for lost taxes from foreign-partner vendors.

The German Finance Ministry wants online retailers to be liable for unpaid value-added taxes by vendors who aren’t registered with German tax authorities, according to draft legislation from the ministry obtained by Bloomberg News. If the companies fail to block sellers that don’t pay VAT, they’d be forced to pay the tax themselves.

The new rules would “hold online marketplaces accountable" for lost taxes, according to the draft dated June 21, which says “it’s necessary to ensure VAT taxing and is therefore in the public interest.”

Many European countries say large tech companies -- think Google parent Alphabet Inc. and Uber Technologies Inc. -- aren’t paying their fair share to public coffers, and the effort to crack down on tax avoidance has led to large bills delivered in recent years to Apple Inc. and Amazon.

Europe’s existing tax rules were designed for the traditional economy and don’t fully capture activities based on data and intangible assets, such as intellectual property.

©2018 Bloomberg L.P.