Tech giants decry French digital tax

WASHINGTON, USA (AFP) — American tech giants Amazon, Facebook and Google joined forces on Monday to decry the French digital tax as retroactive and discriminatory.

President Donald Trump is considering retaliating against the tax — approved July 11 — with punitive tariffs on French wine imports, prompting an investigation by the Office of the US Trade Representative (USTR).

The so-called GAFA companies appeared at a USTR hearing on possible countermeasures and were unanimous in their complaints, calling the tax a “troubling precedent.”

The tax, which Washington considers unfair, adds yet another bone of contention to the transatlantic trade disputes that now also include steel, aluminum, automobiles, aircraft and agriculture.

The proposed three percent tax on total annual revenues of companies that provide services to French consumers applies only to the largest tech companies, which are mostly US-based.

For Amazon, where France represents the second largest European market for e-commerce, the levy “creates a double taxation,” said Peter Hiltz, director of tax planning for the online retail giant.

Some 58 percent of Amazon’s sales are through partner companies, which stand to take the hit.

The tax “negatively impacts Amazon and thousands of small and medium businesses,” Hiltz said.