Skip to main content

France considers hitting major web firms with Internet tax

Major Internet companies have been on the receiving end of much flack for their alleged sneaky, tax-dodging ways over the past year. And France has put forth a new plan to counter their so-called tax avoidance: an Internet levy applied to companies that gather personal data, the New York Times has reported.

According to the newspaper, the proposition originated in a French government report that summed up how France is responding to the loopholes used by companies such as Google, Facebook and Amazon to limit the amount of tax they pay. Late last year, details about France’s investigation of Google’s tax practices were revealed, with the country’s budget minister urging Google to sort out its tax affairs or face legal repercussions.

The report, commissioned by French president Francois Hollande, outlines a tax tied to the number of users tracked by each company. The personal details collected by these companies comprises the “raw material” of the digital economy and users of services like Google and Facebook are akin to unpaid workers, according to the report.

“They have a distinct value, poorly reflected in economic science or official statistics,” it reads.

In a statement, Google said it was in the process of reviewing the report. The search giant has faced similar accusations of tax avoidance before, and has consistently maintained its innocence.

“Google conforms with the tax laws in all the countries where the company operates. We co-operate with local authorities and we work with them to answer their questions about Google France and our services," said a spokeswoman in November.

Google France reported sales of €68.7 million (£55 million) in 2010, of which the company paid French income taxes of just €2 million (£1.6 million).

Image Credit: Flickr (whizzer)