Tax on digital services is not a good idea, according to National Digital Council

Jul 19, 2013
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Conseil National du Numérique, Fleur Pellerin

The CNNum (Conseil National du Numérique) will give its report about taxation of digital goods to François Hollande and his government on the 24th of July. The answer is clear : this is a bad idea.

For a few years and since Sarkozy’s previous government, France has been trying to force the Big Four (Google, Apple, Facebook, Amazon) to pay its taxes and on a general basis to force the foreign companies to play fair with the national ones. The four aforementioned companies indeed paid only 37,5 million out of the 830 million they should have normally paid in France in 2011.

According to the CNNum, creating such a tax would only put small businesses into trouble. The big companies, the real target would find ways not to pay anyway. Besides, digital goods are implicated in every economic sector, a tax would thus affect the whole French economy. For the CNNum, only an international — European — tax would make sense.

The solution is rather to enforce the already existing law and hunt tax evaders. For the council created by Sarkozy in 2011, taxing cloud services, bandwidth, data collection, devices or e-commerce has simply more cons than pros.

The report will also include an analysis of the new taxes created by the government those last months, which concerns online advertisement, devices and bandwidth. The government should decide before September whether or not such a tax should be voted, anyway, other players will join the game of digital goods taxation, like the Fédération Française des télécoms (French Telecom Federation) which asked again, on the 16th of July that online companies should be taxed equally, in other words, that Skype et al be considered as operators and taxed as such.

Picture : Wikimedia Commons