French tax on net giants could yield 500m euros a year

French tax on net giants could yield 500m euros a year

French tax on net giants could yield 500m euros a year

A 3% French tax would be levied on mostly US internet companies earning global digital revenue of at least 750 million euros.

But companies such as Amazon earning money as a digital intermediary between a producer and a client would have to pay. Sales of personal data for advertising purposes would also be targeted. Other firms include the likes of Uber, Airbnb, Booking and French online advertising specialist Criteo.

"A taxation system for the 21st century has to build on what has value today, and that is data", Finance Minister Bruno Le Maire told in an interview with Le Parisien newspaper.

The European Commission has estimated that traditional companies typically pay around 23 percent tax on profits, compared to between 8 and 9 percent for internet firms, some of which pay little or no tax at all.

US, Chinese and European companies may meet the levy criteria, including a few French businesses, the report said, as governments grapple with how to tax global Internet companies that can generate huge domestic revenues from limited physical assets.

Le Maire is to provide a draft law to the French cabinet on Wednesday before it is presented to parliament. The plans have attracted considerable controversy, and have been opposed by member states including Ireland, but France has been a strong supporter of the move.

The Internet Reacts to the Alleged Sonic the Hedgehog Movie Leak
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The new tax scheme comes just months after the so-called "Yellow Vest" protests swept through France, with angry residents clashing with police over high energy costs, massive taxes, lack of employment, and other issues.

The new tax won't be applied to revenues earned by the companies that sell their products on their own websites.

Elsewhere, Spain and the Britain also considering digital sales taxes, Bloomberg reported.

Among companies that already pay taxes in France, the amount paid will be deductible from pretax income, Le Maire said. "For all these big digital companies, European consumers are decisive".

"With the European Commission position, and the support of the United States, we can get a digital tax proposed at the worldwide level, at the OECD, by the end of 2019", he said. "Let us be clear: the United States does not like these different national taxes in Europe".

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