Wed, Apr 10, 2019 - Page 10 News List

French lawmakers pass digital tax, defying US ire

‘FAIRER TAXATION’:The legislation comes amid rising public outrage at the minimal tax paid by some of the world’s richest companies, such as Facebook and Apple


French lawmakers on Monday approved a new tax on digital giants, such as Facebook and Apple, that has angered the US, with French Minister of Finance Bruno Le Maire boasting that France was proud to be in the vanguard of such a move.

The US has urged its NATO ally to drop the plan, with US Secretary of State Mike Pompeo warning last week that it would hurt both the US firms and the French citizens who use the platforms.

The measure was approved by 55 votes against four in the French National Assembly, or lower house, with five abstentions.

It will be put to a vote in the Senate before becoming law.

The legislation, dubbed “GAFA” — after Google, Amazon, Facebook and Apple — comes amid rising public outrage at the minimal tax paid by some of the world’s richest firms.

“France is honored to be leading on such subjects,” Le Maire told parliament before the vote, saying that the draft constituted a “step ... towards a fairer and more efficient taxation for the 21st century.”

Responding to the criticism from the US, Le Maire said that France was “determined” to press on with the legislation and would be “sovereign” on fiscal issues.

He said it was “unacceptable” that digital giants could make considerable profits from user data so that the “profits are made in France, but the taxes are imposed abroad.”

Last month, France unveiled the draft legislation to set a 3 percent tax on digital advertising, the sale of personal data and other revenue for any technology company that earns more than 750 million euros (US$840 million) worldwide each year.

France is seeking to agree on the legislation on a national level after an EU-wide effort was scuttled by low-tax countries such as Ireland, which have wooed big technology firms.

However, Le Maire insisted that a “good solution in the long term would be a multilateral solution,” vowing not to let up in efforts for an agreement within the Organisation for Economic Co-operation and Development.

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