Amazon, Google face digital taxes from growing list of countries
France introduced a new tax that could hit Silicon Valley giants like Google, Amazon and Facebook.
The measure, introduced by the government on Wednesday, would levy a 3 percent tax on revenues the tech companies generate in France from services like advertising or operating a digital marketplace.
The proposal targets about 30 firms, including some Chinese and other European businesses. The bulk, however, are U.S.-based companies. It specifically aims for companies with global revenues of at least $847 million.
The French government believes the tax could bring in around $4.5 million in its first year – and even more in the years to come.
The tax would retroactively apply to the outset of 2019.
Meanwhile, a growing share of countries are looking to devise ways to raise revenue from these tech companies, which don’t pay the same taxes as other businesses – despite raking in handsome profits.
Here’s a look at some of the other countries that have introduced similar measures, or that may follow suit:
Britain
Last year Britain unveiled a measure aimed at taxing locally-sourced revenue from online platforms to keep its tax structure up-to-date in the digital age.
The 2 percent tax is aimed at large, profitable internet companies with global revenue in excess of $641 million, as reported by The Wall Street Journal.
Spain
In October, the Spanish government released a draft bill of a digital services tax, which was marked up into a final bill in January.
The legislation seeks to impose a 3 percent tax on revenue generated from digital services like targeted online advertising. Similar to the other measures, it only targets companies with global revenue above a certain threshold.
The bill needs to be voted on by the government.
South Korea
Last year, Seoul announced it was considering the need to introduce a digital tax.
The South Korean government explained that without a physical presence in the country, many of these internet companies are not subject to corporate income tax, as reported by Reuters.
Mexico
A proposed 3 percent tax measure on digital services was proposed in Mexico, pertaining to digital advertising, social media platforms and the collection of personal data.
India
India is weighing a digital tax on companies that profit in the country, but don’t pay full taxes there. Full details regarding the rules could be released later this year.
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New Zealand
Last month, New Zealand said it was working on a cross border digital services tax, worth 2 percent to 3 percent of revenue generated by online companies in the country, as reported by The Associated Press.
