The US officials have reportedly opposed investigation of tech giants like Google and Amazon over alleged tax evasion and have made their stand clear about international tax rule changes that narrowly target some of the world's fastest growing multinationals.
According to the Guardian, France, which initiated the probing, has failed to secure backing for tough international tax rules with regard to the tech giants after US opposed the proposals to be presented at this week's G20 summit.
There has been intense debate between US and French governments over how far the tax reform proposal should go, which is to be drafted by The Organisation for Economic Co-operation and Development (OECD).
The report said that US concedes that the rules need to be updated and are pushing for moderate change with little tweaks to the existing wording of international tax treaties rather than the creation of wholly new passages dedicated to spelling out how the digital economy should be taxed.
France has been among the most aggressive in responding to online businesses that target French customers but pay little or no French tax. Tax authorities have raided the Paris offices of several firms including Google, Microsoft and LinkedIn, challenging the companies' tax structures.
Google chairman Eric Schmidt said that international tax law could almost certainly benefit from reform not just in the UK but also in America and elsewhere and said that OECD action plan is 'hotly awaited', the report added.