Spain’s ‘Google Tax’ What is it?

Spain's "Google Tax," officially known as the Digital Services Tax (DST), is a 3% levy on revenues from specific digital services, including online advertising, intermediary services, and the sale of user data.

This tax targets large multinational companies with global revenues exceeding €750 million and Spanish revenues over €3 million. The DST was implemented to ensure that digital companies contribute taxes in countries where they generate value, addressing challenges posed by the digital economy.

However, the United States, under President Donald Trump, views such taxes as discriminatory against American tech giants. In February 2025, President Trump issued a memorandum directing U.S. agencies to investigate foreign DSTs, including Spain’s, and to recommend appropriate responses, such as imposing tariffs. The administration argues that these taxes unfairly target U.S. companies and has threatened retaliatory measures, including tariffs on imports from countries implementing DSTs.

Spain should be concerned about potential U.S. retaliatory actions, such as tariffs on Spanish exports, which could impact its economy. The U.S. has previously considered imposing tariffs on countries with DSTs, viewing them as unfair trade practices. Therefore, Spain faces the challenge of balancing its tax policies with the risk of escalating trade tensions with the United States.