ROME (Reuters) – Italy should be cautious about taxing web companies more as it risks retaliation from the United States, Deputy Economy Minister Maurizio Leo said on Tuesday.

A tax on digital companies, including US tech giants, has been in place since 2020 and is worth about 300 million euros ($329 million) a year.

Under the scheme, companies such as Meta Platforms Inc, Google and Amazon must pay a 3% tax on income derived from Internet transactions.

“We cannot go beyond that,” Leo told a parliamentary hearing.

“Other countries across the Atlantic are urging us to be cautious and if we raise taxes there could be retaliation in terms of higher tariffs,” Leo said, speaking of the United States.

In late 2019, just a few weeks before the Italian parliament approved the tax, Washington said the tax unfairly targeted American companies.

Leo told lawmakers the issue should be addressed as part of talks to implement a global minimum tax aimed at preventing big companies from hiding profits in tax havens. ($1 = 0.9122 euros)

(Reporting by Giuseppe Fonte; Editing by Keith Weir)

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