RIO DE JANEIRO, July 23 Reuters Talks over a global tax deal are continuing well past a June 30 deadline and governments are now looking to a Group of 20 finance leaders meeting this week for progress on a stalled plan to reallocate taxing rights on large multinational companies.

The socalled Pillar 1 arrangement, part of a 2021 global twopart tax deal, aims to replace unilateral digital services taxes DSTs on U.S. tech giants including Alphabet39;s Google, Amazon.com and Apple through a new mechanism to share taxing rights on a broader, global group of companies.

The stakes in the negotiations are high. A failure to reach agreement on final terms could prompt several countries to reinstate their taxes on U.S. tech giants and risk punitive duties on billions of dollars in exports to the U.S.

Standstill agreements under which Washington has suspended threatened trade retaliation against seven countries Austria, Britain, France, India, Italy, Spain and Turkey expired on June 30, but the U.S. has not taken steps to impose tariffs.

Discussions on the matter are continuing. An Italian government source said that European countries were seeking assurances that the U.S. tariffs on some 2 billion worth of annual imports from French Champagne to Italian handbags and optical lenses remained frozen while the talks continue, including at the G20 meeting in Rio de Janeiro.

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A European Union document prepared for the G20 meeting lists finalizing the international…