France to tax Internet giants Google, FB, etc.

PARIS — The French government on Wednesday unveiled plans to slap a 3 per cent tax on the French revenues of Internet giants like Google, Amazon and Facebook.

The bill is an attempt to get around tax avoidance measures by multinationals, which pay most of their taxes in the EU country they are based in — often at very low rates. That effectively means the companies pay next to no tax in countries where they have large operations.

The tax will apply to digital companies that have global revenues of over €750 million, and French revenue over €25 million. That will help protect startups, Finance Minister Bruno Le Maire said in a news conference.

30 companies to be affected

About 30 companies, mostly based from the US, but also from China and Europe, will be affected. France is set to be the first European country to implement such a tax as the bill presented on Wednesday in a cabinet meeting is likely to pass in the coming months in parliament, where French President Emmanuel Macron’s party has a majority.

Govt will earn €500M

Le Maire estimated the tax will raise about €500 million this year but that should increase “quickly”. He said the tax will not affect companies directly selling their own products online. It will mostly affect companies that use consumers’ data to sell online advertising. It will also apply to online services companies like Airbnb and Uber.

“This is about justice,” Le Maire said. “These digital giants use our personal data, make huge profits out of these data ... then transfer the money somewhere else without paying their fair amount of taxes.” —