France adopts digital tax

CNC
Added On July 13, 2019

The French Senate, the opposition-controlled upper house of Parliament, has passed a law introducing the so-called GAFA tax, making France one of the first countries to impose a tax on digital giants. World News reports.

GAFA is an acronym for Google, Apple, Facebook and Amazon.
The new law paves the way for the eurozone's second largest economy to unilaterally levy a 3-percent tax on much of the internet giants' digital sales in France related to advertising, websites and the resale of private data.
GAFA targets digital companies with global annual sales exceeding 750 million euros (844 million U.S. dollars) and sales in France of at least 25 million euros.
French Finance Minister Bruno Le Maire said with the taxation of digital services, France is building the tax system of the 21st century, which should be fair and efficacious.
He added that France wants to impose on these new business models the same rules that apply to all other economic activities.
The tax was adopted by the National Assembly, the lower house of Parliament, on July 4.
On Wednesday, the United States launched a Section 301 investigation into the tax.
The U.S. move could lead the U.S. administration to impose new tariffs on French imports if Washington and Paris cannot reach a negotiated settlement.