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France Proposes an Internet Tax
By ERIC PFANNER
Published: January 20, 2013
PARIS — France, seeking fresh ways to raise funds and frustrated that American technology companies that dominate its digital economy are largely beyond the reach of French fiscal authorities, has proposed a new levy: an Internet tax on the collection of personal data.
The idea surfaced Friday in a report commissioned by President François Hollande, which described various measures his government was taking to address what the French see as tax avoidance by Internet companies like Google, Amazon and Facebook.
These companies gather vast reams of information about their users, harnessing it to tailor their services to individuals’ interests or to direct customized advertising to them. So extensive is the collection of personal details, and so promising the business opportunities linked to it, that the report described data as the “raw material” of the digital economy.
“They have a distinct value, poorly reflected in economic science or official statistics,” the report said.
Google generates more than $30 billion a year in advertising revenue, including an estimated €1.5 billion, or $2 billion, in France. Yet, like other American Internet companies, it pays almost no taxes in France. That state of affairs upsets France’s policy makers, as public finances have been stretched thin and French Internet companies struggle to gain traction.
“We want to work to ensure that Europe is not a tax haven for a certain number of Internet giants,” the digital economy minister, Fleur Pellerin, told reporters in Paris on Friday."
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By ERIC PFANNER
Published: January 20, 2013
PARIS — France, seeking fresh ways to raise funds and frustrated that American technology companies that dominate its digital economy are largely beyond the reach of French fiscal authorities, has proposed a new levy: an Internet tax on the collection of personal data.
The idea surfaced Friday in a report commissioned by President François Hollande, which described various measures his government was taking to address what the French see as tax avoidance by Internet companies like Google, Amazon and Facebook.
These companies gather vast reams of information about their users, harnessing it to tailor their services to individuals’ interests or to direct customized advertising to them. So extensive is the collection of personal details, and so promising the business opportunities linked to it, that the report described data as the “raw material” of the digital economy.
“They have a distinct value, poorly reflected in economic science or official statistics,” the report said.
Google generates more than $30 billion a year in advertising revenue, including an estimated €1.5 billion, or $2 billion, in France. Yet, like other American Internet companies, it pays almost no taxes in France. That state of affairs upsets France’s policy makers, as public finances have been stretched thin and French Internet companies struggle to gain traction.
“We want to work to ensure that Europe is not a tax haven for a certain number of Internet giants,” the digital economy minister, Fleur Pellerin, told reporters in Paris on Friday."
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