Smartphone and personal computer
27 August 2019

Digital tax: France at the forefront

As the first State in Europe to introduce taxation on digital giants, France paved the way for progress towards a global solution at the G7 Summit in Biarritz (24-26 August 2019).

Significant headway was made at the G7 Summit in the plans to tax tech giants. The domestic tax on digital services, which France adopted on 11 July 2019, set the stage for enacting international taxation.

The finance ministers of the G7 nations had already agreed on the need for a digital tax and a minimum global tax rate for the tech giants at their meeting in Chantilly on 17 and 18 July 2019. Bruno Le Maire, Minister of Economy and Finance, hailed the fact that "this is the first time that the G7 Leaders have agreed on this principle."

The plans for digital taxation are now in the hands of the Organisation for Economic Co-operation and Development (OECD). Bruno Le Maire specified that "the OECD is expected to submit an agreement to the G20 by the end of 2020".

Working towards a global tax

As France has already pledged, the global tax will replace the domestic tax as soon as it is adopted at the OECD. France will not wait until all of the OECD countries have ratified the agreement to do so.

To give a recap, the legislation passed by Parliament aims at taxing tech giants up to 3% of the turnover they make on digital services (advertising revenues, commission earned by platforms and revenues from the resale of personal data) in France.

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28 August 2019


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