France Begins To Demand Digital Tax From US High-Tech Giants

The French authorities have started sending notifications to American corporations about the need to pay a new digital tax, the Financial Times reports. Among others, Facebook and Amazon have already received notifications requesting them to pay tax for 2020.

The French law provides for a tax of 3% of the revenue of technology companies that they receive in France. This applies only to companies with an annual turnover of at least €750 million, of which at least €25 million must be received in France. Thus, it will affect about 30 international corporations, such as Google, Amazon, Facebook, Apple, Uber, Airbnb and Booking.

The bill was passed by the French authorities last year and provides for the collection of taxes from 1 January 2020. However, the French authorities have been postponing the implementation of the digital tax law for a long time, hoping for a successful conclusion to negotiations with both the US and its partners in the Organisation for Economic Co-operation and Development (OECD). However, the US Treasury Department withdrew from the negotiations back in June this year. A month later, the US announced the introduction of a 25% duty on goods from France worth $1.3 billion as a response to the digital tax.

The new duties will come into force on 6 January 2021. Money will be levied on French cosmetic products and bags. As far as the OECD is concerned, negotiations have dragged on and have not yielded any results so far. On this basis, as the French side previously warned, France has activated its own digital tax collection for international corporations.


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