The French parliament has voted in favour of passing new tax legislation for large technology companies. While this is just the first stage of voting, the second and final stage is expected to just be a matter of formality.
Any organisation that generates over €750 million globally in revenue and over €25 million in France will be required to pay 3% tax on French revenue, on top of what is already paid. It is believed that approximately 30 businesses will be immediately affected.
The tax has been designed to target marketplace and advertising companies, including Facebook, Amazon and Google.
French Economy Minister Bruno Le Maire has estimated that the tax could bring in as much as €500 million by the end of 2019.
He is also encouraging the European Union (EU) to implement a similar tax across all member states. According to France 24 he said: “[It] is a question of fiscal justice. Digital giants pay 14 percent less tax than small- and medium-sized European companies”.
However, in order to change taxation rules in Europe representatives must unanimously agree. Some countries that house numerous regional headquarters, such as Germany, have been reluctant to consent.
At the moment, large companies are allowed to report their European income to any EU nation. This has led to some of them choosing low-tax countries such as Ireland and Luxembourg.
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