French Parliament Votes Through Digital Tax

12/07/2019

On July 11, 2019, France's proposed digital services tax received parliamentary approval, following approval also from the Senate.

The three percent turnover tax will be imposed on digital companies providing advertising services, selling user data for advertising purposes, or performing intermediation services. Companies with global revenues of EUR750m (USD852m) or more and French sales of at least EUR25m will be required to pay the tax.

The tax will apply retrospectively to turnover realized in France since January 1, 2019. Around 30 companies supplying digital services in France are expected to pay the tax, which the French Government has estimated will raise EUR500m in revenue per year.

The tax is intended to be a temporary measure until an agreement is reached on international digital tax measures at the OECD. However, while the legislation does not stipulate an expiry date for the tax, a joint committee of lawmakers from the House of Representatives and the Senate agreed last month that the report on the implementation of the tax must include a date on which any measures agreed at international level will replace it.

Source: Pride Partners International