Wednesday , August 10 2022

France wants an agreement with Washington on digital tax until the end



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August

As a result of Donald Trump's criticism that threatens France with customs crackdown on wine, the government hopes to reach an agreement with Washington on taxing digital giants by the end of August,

"We want to work closely with our American friends on the global taxation of digital activities," Economy Minister Bruno Mayor said on Saturday, adding that they want to reach such an agreement by the G-7 heads of state at the end of August.

He responded to the attacks by Donald Trump, who had condemned Emanuel Macron's "stupidity" before the day, for the tax voted in parliament in early July, and threatened to avenge French wine, which he believes has more favorable customs conditions. US as American wine in Europe.

"We do not think it is a good policy to mix these two topics," which "have nothing to do," said the French economy minister, urging him to leave the "tariff issue." which is "totally different".

What I see is that these tariffs have not hindered a very strong increase in American wine consumption in Europe and France over twenty years, as volume has increased by more than 30% in the last ten years. "Recalls the mayor.

At the fire front, French exporters of wine and spirits (FEVS) hoped on Saturday that France and the United States would find an agreement "to prevent these threats from materializing and limiting access of French wines to the US market"

The French minister insisted that the French tax on digital giants, often called the "Gafa tax" (for Google, Amazon, Facebook and Apple) to be realized this year, does not apply exclusively to US companies.

"We have no desire to focus our efforts on US companies," the minister said several times, assuring that there was "absolutely no discrimination in the French national tax".

Interview with Munchin

By deciding to put pressure on it, Washington has begun investigating the effects of this tax decided by France pending an agreement at an international level. Depending on your findings, this can lead to revenge.

"American, European or Chinese multinational companies have a digital activity, sometimes without a physical presence in a given territory and pay little or no taxes," the minister of economy said.

"This situation is not acceptable and our collective interest is to achieve fair taxation of digital activities in the world," he said.

For this purpose, Bruno Le Mayer will meet at 17:00 with his US counterpart, US Secretary of State Steven Munchin, hoping to proceed to a deal in the G7.

The goal is to reach a global agreement at OECD level by the end of 2020.

In mid-July, within the G7 financial group, the seven most advanced economies have reached a consensus that the French Presidency has put forward as a "step forward" in taxing the activities of multinationals, even when they have no "presence". in the country concerned.

"For 24 months have been made giant steps, now it remains very last, it is the most difficult, the agreement of the seven heads of state in G7 Biarritz," – said the mayor.

"If we can take this step (…), we will pave the way for an OECD-level agreement and a 2020-end solution," he said. France will then end its tax.

The so-called Gafa tax generates taxation on large companies in the sector and not profits, often consolidated in very low tax countries like Ireland, but up to 3% of France's turnover, including targeted online advertising, data sales for advertising purposes, and connecting Internet users with platforms.

JFA / EF / RNA

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