Austria 5% Digital Services Tax

5% sales tax on online advertising revenues earned from Austrian users

In 2020, Austria introduced a Digital Services Tax (DST) as part of a broader digital tax package, targeting large online corporations that generate advertising revenue in Austria. This measure came after failed EU-level attempts to tax digital services and is intended as a temporary national solution pending a comprehensive EU or OECD framework.

See our global DST tracker.

In February 2025, a President Trump DST review was launched, looking at potential retaliatory measures against DST’s. The US has long since these taxes as discriminatory since their high thresholds single out large US digital platforms. A US review of the Austrian DST in 2021 highlighted these risks.

Austrian 5% on digital advertising tax

The Austrian DST imposes a 5% tax on online advertising revenues earned from Austrian users. It applies to online service providers with global revenues exceeding €750 million and at least €25 million in Austrian online advertising revenues. The tax is levied on the remuneration received for services such as banner ads, search engine marketing, and comparable formats, provided the advertising is targeted at users with Austrian IP addresses.

Only advertising specifically directed at Austrian users—based on content, design, and geo-targeting—is taxable. Individualized ads like retargeted banners almost always qualify, while general banner ads may only be taxable if clearly aimed at Austrian users. Advertising on international websites not specifically targeted at Austria (e.g., a German site with a general banner) would generally not be taxable. However, specific offers or content aimed at Austrian users would trigger DST liability.

Online service providers, including those without a permanent establishment in Austria, must register electronically for DST and file an annual tax return three months after their financial year ends. Payments are made monthly (as advance installments), and records of advertising types, revenue, clients, and geolocation data (like IP addresses) must be retained. In cases where providers cannot allocate revenues precisely to Austrian users, they may request permission to use an alternative calculation method.

The Austrian DST does not include a specific penalty regime, but non-compliance may trigger the country’s general financial crime laws, including potential fines for tax evasion. The Ministry of Finance may issue further regulations and conduct plausibility checks or audits, particularly referencing VAT data.

Ultimately, Austria’s DST seeks to ensure that digital businesses contribute fairly to taxation, particularly in markets where they generate substantial advertising revenue.

Europe Digital Services Taxes (DST)