French government to impose digital tax on huge internet giants

The French government has reportedly announced that it has introduced a tax for companies along the likes of Amazon, Facebook, and Google. Reliable reports claim that tax is a means of enforcing stricter regulations on huge technology conglomerates sans any viable support from the European Union.

As per sources familiar with the knowledge of the matter, the 3 percent tax will apply to the French revenues of close to 30 pivotal companies – a majority of them being from the United States. A statement by the Finance Minister of France, Bruno Le Maire, had projected that the tax will raise around EUR 500 million (USD 565 million) annually.

As a matter of fact, numerous other countries – Germany, Spain, and the UK to name a few, have also been working on their own digital tax initiatives.

The French tax is reported to be applied to companies which generate global revenues of at least EUR 750 million (USD 847 million) (on their digital services), with around EUR 25 million (USD 28 million) from France alone.

A Google spokesperson has been reported to state that the firm is diligent about paying all the due taxes and also complying with the tax laws in every nation it has presence in. Google also pays a major proportion of its corporate income tax in the U.S., and has already paid a worldwide effective tax rate of 23% over the last decade, the spokesperson continued.

For the record, a similar initiative had been passed by the EU last year, wherein the organization intended to pass a 3% tax on the revenues of huge internet companies. Apparently, the initiative had failed on the grounds of concerns from countries such as Ireland and Germany, regarding fears of retaliation from the U.S.

It has been reported that presently, The OECD is examining a global digital tax, though it will not be seeing he light of the day until 2020.