France, UK push ahead with tech tax to make platforms pay
France has pushed through its tech tax and will impose a levy primarily aimed at companies that collect user data to sell advertising (Associated Press).
Key points
- French Senate voted in favour of a 3 per cent levy on French revenues of platforms with global sales above €750m (A$1.2bn) and French sales above €25m (A$40m)
- France resisted threats of retaliatory tariffs from U.S.
- Finance ministry believes it will initially raise €500m (A$800m) but will quickly rise
- UK set to follow in April in absence of global consensus on new digital tax rules
Australia’s trying but the French and the Poms are leading the charge in cracking down on the free riding of the digital taxis.
Earlier this year the AFR reported on how Facebook and Google appeared to have successfully swerved federal government attempts to take more tax from the duopoly under the Multinational Anti-Avoidance Law (MAAL) by adjusting how revenues are accounted and attributed. That leaves the government pinning hopes on the Diverted Profits Tax, which is modelled in part on the UK’s ‘Google tax’.
France’s approach puts a 3 per cent levy on French revenues of digital firms with annual worldwide sales greater than €750m (A$1.2bn) and French revenue greater than €25m (A$40m). It targets firms that use consumer data to sell digital advertising, per Associated Press.
The UK’s equivalent is set to kick in next April. It will impose a 2 per cent levy on revenues derived from providing a social media platform, search engine or online marketplace to UK users.
