France Goes Ahead With Digital Tax

Photo Credit: AFP PHOTO / GERARD JULIEN

Big tech just received a massive slap from the French government on Thursday as lawmakers passed a new digital services tax.

Big tech companies like Google and Facebook will now have to pay a new digital services tax in France. The French Senate gave the final approval for the tax, which will be applied to big tech companies with a revenue of more than 750 million Euros, of which at least 25 million must have been made inside France. The move on the part of French lawmakers comes after years of international dissatisfaction due to the fact that massive technology corporations haven’t had to pay much, if anything at all, inside countries where they have a serious presence. For the most part, big tech companies declare most of their profits where they are headquartered.

Not everything is expected to be smooth sailing for the French treasury, however. This move by French lawmakers has caught US President Donald Trump’s attention, and the possibility for a new trade dispute between the US and EU is high. Trump has already ordered his top trade official to launch a “Section 301” investigation into the new digital services tax. The French government has already declared that they would scrap the new law if a similar measure could be agreed upon internationally. The Organization for Economic Co-operation and Development (OECD) is leading multilateral discussions on how to tax these international tech companies, which the US has said it will continue taking part in while it also investigates the matter on its own.

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