Around 30 internet companies will be affected by the new digital tax legislation, French Finance Minister, Bruno Le Maire, said on Sunday (March.3rd).
Most of the companies’ subject to the proposed 3% tax will be American, but Chinese, German, Spanish, British, and one French firm will also be forced to contribute to the digital tax, Le Maire told Le Parisien newspaper.
As expected, the world’s largest tech firms are on the list, including Google, Amazon, Facebook, and Apple, according to the report.
Other firms that will have to pay the tax revenue include Uber, Airbnb, Booking.com and French online advertising specialist, Criteo.
According to Reuters, Bruno Le Maire told the Le Parisien newspaper that the digital tax legislation is aimed at companies with a worldwide digital revenue of at least 750m and French revenue of more than 25m euros ($28.2m/£21.5m).
The tax would yield 500m euros ($565m/£430) per year for French authorities, he added.
“A taxation system for the 21st century has to built on what has value today, and that is data,” Le Maire said.
It is a matter of “fiscal justice”, he added, as most digital giants pay some 14 points less tax than European small-and-medium sized companies. Fairer taxes are also a key demand of the “yellow vest” protests seen across France in the past three months.
To avoid penalising companies who already pay taxes in France, the amount paid will be deductible from pre-tax income, Le Maire said.
The legislation is expected to be presented to the cabinet on Wednesday before it presented to Parliament.
EU digital tax
France is not the only European country that is calling for a digital tax to be adopted.
Last month, the French finance minister said, the European Union could reach an agreement on details of a digital tax by the end of March.
The EU digital tax was defeated in its previous form, due to strong opposition from other countries.
EU decisions on taxation requires unanimity from all 28 member states, which is often hard to achieve as advocates of low taxation – such as Ireland – believe that the tax could damage the EU’s competitive tax regime and strain ties with the US, according to The Irish Times.
The European Union tax was only intended as an interim measure until a consensus was reached by the Organisation for Economic Co-operation and Development (OECD).
The UK and the New Zealand government also plan to introduce a digital service tax targeting established tech giants.
Tech firms have previously stated that they abide by all the laws as they’re currently written.