[Arkinsaw]

and how them Europeans plan on collecting?

They will simply order it to be done and US companies will do it. For instance, they will order Microsoft to collect this tax on any service it provides (through its .NET stuff for instance). Microsoft will either do it or the EU will take punitive action within the European market. Such punitive action could take the form of skimming the amount off the top of any profits Microsoft would make within Europe or restricting Microsoft's access to the European market. The IBM's, Microsofts, etc. will collect the tax and mail them a check. They have too much to lose if they don't. The EU doesn't particularly care if Joe Blow refuses to collect the tax for them....they really are aiming at our big information technology corporations and they will do it.

[Ken H]

That makes sense. Thanks.

[crasher]

Just a question. What if Micrsoft, IBM, or somebody else says we aren't collecting the tax, and we aren't recognizing your authority to penalize us for not collecting the tax. If you want to enforce this, than we don't do business in the EU.

Upfront, I will concede that no business will do that - it would not make sense. But theoretically, if IBM, Microsoft, etc. were to stop doing business in the EU, how much would the EU be hurt?