
France has approved a digital services tax despite threats of retaliation by US - adzicg
https://www.bbc.com/news/world-europe-48947922
======
bko
I never understood the logic behind taxing large internet businesses.

The idea behind taxes is that you use some public resource and you pay for
that service. You own a home in a neighborhood, you pay property tax that
funds the schools. You drive a car, you pay gasoline tax that funds the
streets. You hire workers locally, you pay the tax to pay back all the
contributions public institutions made to adding the skills to the worker.

But the idea that a company like Amazon owes some tax to France doesn't make
sense. Sure the delivery person uses the roads, but they pay the gasoline tax
and the delivery company pays taxes. What public resources did Amazon, a US
company, use from France?

The other theories of taxation is that it should be used to raise revenue from
the best means possible. I disagree with that framework but applying taxes
arbitrarily hardly seems fair or the best way to raise revenue.

The other argument is that the government should "level the playing field".
But again arbitrarily punishing or helping some corporations opens up the
possibility of corruption and corporate meddling as corporations look for
favors. Much of the edge Amazon has versus local retailers is that it is more
efficient. It doesn't take up store space (and pay taxes on the land) and it
doesn't have to hire a lot of local workers (and pay taxes on their salaries).
It's simply more efficient and its services are appreciated by the consumers.

~~~
ripdog
Those large tech companies can make money in France because the french
government provides all that is necessary for a free, fair and functioning
market. How could Google make money in France if there was no french police
force, education system, market regulation, court system, contract
enforcement?

All money made on the white market in any country is facilitated by that
government, and taxes are paid on all profits to pay for the services which
allowed the profit to be made.

>The other theories of taxation is that it should be used to raise revenue
from the best means possible. I disagree with that framework but applying
taxes arbitrarily hardly seems fair or the best way to raise revenue.

It's not arbitrary to expect businesses to pay for services they benefit from.

~~~
bko
> All money made on the white market in any country is facilitated by that
> government, and taxes are paid on all profits to pay for the services which
> allowed the profit to be made.

So any taxation is justified?

> It's not arbitrary to expect businesses to pay for services they benefit
> from.

Any digital company with revenue of more than €750m ($850m; £670m) - of which
at least €25m is generated in France - would be subject to the levy.

That sounds arbitrary.

~~~
ineedasername
>so any type of tax is justified?

That's a straw man. You're leaping from "some type of tax is justified" which
is quite a bit more reasonable than "any tax".

And if you want to say it's a slippery slope or some such, well, ever single
action if extrapolated to the extreme can be a viewed as such. If 3% is
reasonable and then it's proposed to goes up and up, fight the increase, not
the initial reasonable action. Of course this may be putting words in your
mouth, so I won't attribute it to you, only that I preempt a logical counter
to mine.

~~~
sverige
All taxes are a slippery slope. Name one that has ever been repealed. Income
tax in the U.S. started out as a modest 3% on only the highest incomes and
look where that has ended up: full on wealth redistribution.

We can argue whether that's a good thing or not, but not whether there's a
slippery slope when it comes to implementing a new tax.

~~~
corneliusphi1
In 1944 the highest US tax bracket was 94%

~~~
fuzz4lyfe
I'd happily go back to the effective rate of tax in 1944 if you are so
willing.

~~~
greycol
If we're being facetious then I'm sure there will be plenty in France that are
willing to compromise even more and go further back and implement the
effective tax rate of 1794 on high earners.

------
ElKrist
The US administration is presenting the new tax as if it was specifically
targeted to US companies because of their origin. Like a tariff.

It is not the case at all. Yes the biggest tech giants that do not pay enough
tax are mostly from the US (also other companies from other countries are
affected too)

But it is not because they are from the US that this new tax is created. It is
simply because they don't pay enough tax

~~~
colechristensen
An easy rebuff to the US is simple: if they are American companies, why aren't
they paying American taxes on their European business activities?

~~~
manfredo
They are. The US taxes companies on profits made abroad. The issue is that
these taxes are only collected when the money enters th US, so companies park
this money abroad.

~~~
calcifer
> They are.

The rest of your comment refutes this. They _might_ pay it sometime in the
future, but they are _not_ paying it by parking it abroad.

~~~
manfredo
They can't spend it when it's parked abroad either. It's less that they're not
paying taxes, just that they aren't paying taxes on it _yet_.

By comparison, most European countries don't tax companies on foreign earnings
at all.

~~~
colechristensen
[https://en.m.wikipedia.org/wiki/Repatriation_tax_holiday](https://en.m.wikipedia.org/wiki/Repatriation_tax_holiday)

Or they wait for good deals to come up to bring the funds back home at a
fraction of the cost.

Meanwhile it's easy to get domestic loans based on foreign assets which gives
them easy access to spend that same money locally.

Put it in safe low yield securities on the other side, take out low interest
loans here and profit on the tax money which should have been paid at the
expense of small competitors who don't have the scale for tax scams or the
lobbyists to legalize them.

~~~
manfredo
They still pay taxes, though, even if politicians did set a lower rate for a
period of time. If they bring the money back in to pay back the loans they'll
pay taxes on it.

You call this a "scam" when in reality it's the system working as designed, so
I don't think you have a particularly good grasp on this subject. Again, in
most countries companies don't pay taxes on foreign income _at all_.

~~~
colechristensen
The personal slight isn't necessary.

Things are indeed working as designed, designed by the people who it benefits
through regulatory capture, lobbying, and campaign finance, that part
shouldn't be hard to understand.

If it were "working as designed" there wouldn't be a trend of global
cooperation in closing these tax loopholes and you wouldn't be reading an
article about France working to close one.

>If they bring the money back in to pay back the loans they'll pay taxes on
it.

While profiting from the capital which should have been paid in taxes for
decades, and more importantly out competing their smaller rivals out of the
market because they didn't have the resources, scope, or moral infortitude to
engage in similar behaviors.

Would that it were we all could avoid our financial obligations and paying our
fair share long as we did so eventually while being called heroic.

~~~
manfredo
> Would that it were we all could avoid our financial obligations and paying
> our fair share long as we did so eventually while being called heroic.

Again, most countries - including most European countries - don't Levy taxes
on foreign company earnings at all. If Google were not a US company, they
wouldn't be taxed on _any_ foreign earnings even _without_ any kind of money
parking abroad.

~~~
colechristensen
What's your point?

If I lived in Nevada instead of California I wouldn't have to pay state income
tax so by your logic I should just stop paying?

Once companies get big enough they get to arbitrarily choose which sets of
laws to follow?

People don't have to pay for groceries at food banks so we can walk around the
checkouts at Safeway?

~~~
manfredo
> If I lived in Nevada instead of California I wouldn't have to pay state
> income tax so by your logic I should just stop paying?

No, my point is that Californians shouldn't point to Nevada and say they're
not paying their fair share of taxes.

Google isn't dodging any French taxes, and isn't dodging American taxes
either. What people are complaining about is the fact that American companies'
foreign earnings aren't taxes until those earnings are brought into the
country. This is not against the law, since companies aren't forced to move
that money back into the country. And to put the cherry on top, most countries
don't tax companies on foreign earnings at all.

So France is trying to say that they are being disadvantaged because these
companies are delaying payment of _American_ taxes, on earnings that wouldn't
be taxed at all in France or most other European countries. This is blatant
hypocrisy. France is complaining that American isn collecting taxes too slowly
on earnings that it and it's peers don't tax at all. If European countries
think corporations should pay taxes on foreign earnings, maybe they should
begin with taxing their own corporations' foreign earnings first.

------
opportune
Part of me originally wanted the US to retaliate since this theoretically
threatens my paycheck, but a 3% tax on revenue generated within the country is
pretty low and seems reasonable considering how ineffective taxing profits is
due to loopholes.

I really don't think it's sour grapes so much as trying to address the
Irish/Luxembourgish tax schemes

~~~
charlesdm
Correct in theory. But have you looked at french tax policy? The issue with
new taxes is that often it starts at 3%, then goes up gradually to 5, then to
7, and before you know it you have a 15% turnover tax.

France is a lovely country, but one of the worst players when it comes to tax
policy. The never ending appetite to increase the spending of the state does
not stop...

~~~
hmartiniano
Which is actually a good idea: increase tax on revenues for companies using
tax-evasion schemes until it is no longuer profitable for them to continue
doing so.

Also, consider the fact that tax evasion is a crime in most countries and that
this is a very bland measure when compared to what these companies (and their
executives) really reserve.

~~~
eurg
increasing taxes makes tax-reduction-strategies _more_ profitable, not less

also, tax-evasion and tax-reduction are two different things, equating them is
an argument in bad faith

~~~
hmartiniano
What I was arguing is that raising taxes _revenues_ instead of profits (when
companies declare no profits as part of tax-avoidance schemes) will eventually
make them declare and pay taxes on real profits.

You have a point here, but what really is at stake here is tax-evasion, not
reduction.

The company declares no profits in France (and thus pays no tax) because its
profit is fraudulently passed as costs to pay for IP or services for the
mother company in another country.

~~~
charlesdm
What you call fraudulent is not actually fraudulent. It makes a lot of sense
to allow this.

If a US company develops IP in the US, is it not normal that they then get to
charge a royalty for use of said IP globally?

If a French company develops IP in France, is it not normal that they then get
to charge a royalty for use of said IP globally?

If you have a centralised office somewhere supplying back office services to
all entities within Europe, does it not make sense to allow companies to tax
deduct these expenses?

It seems like an easy thing to fix, but it's not. Particularly because
multinationals _do_ actually operate in many countries and can pick where to
base their operations.

------
99052882514569
Taxing digital companies based on digital presence certainly makes sense to
me, as a layperson. A company that's selling ads to a French company that
wants to show those ads to French users is doing business in France, end of
story.

Taxing only very large corporations - that's a little more questionable, but
plenty of countries (including the US) treat small businesses preferentially,
so it's not like it's unprecedented.

~~~
bluecalm
It's really not that simple. They don't use any of the country infrastructure
or workers. If I make a video game and sell it to a person in France does it
mean I do business in France? It seems to me it should be treated the same as
French person coming to my country, buying my game and going back home. We've
just skipped on unnecessary traveling. Those things are subject to debate and
power struggle but it's clear that: I sell it to you so I do business where
you live isn't story-ending argument. In fact I think it's both not very
consistent with general tax law principles nor practical as the burden of
complying with regulations in every country you sell to even if you don't have
presence there means many companies dummy won't sell at all to smaller
countries.

~~~
gamblor956
_If I make a video game and sell it to a person in France does it mean I do
business in France?_

Yes, by the commonly and globally accepted definition of "doing business" in a
country, selling into a country is doing business in that country.

 _It seems to me it should be treated the same as French person coming to my
country, buying my game and going back home._

No, it would be more like your company going to France, selling the French guy
the game, and then coming back to the US. The burden of tax compliance is
placed on you, the seller, because you are the one profiting from the activity
and therefore morally (and legally) should shoulder the burden.

 _In fact I think it 's both not very consistent with general tax law
principles nor practical as the burden of complying with regulations in every
country you sell to even if you don't have presence there means many companies
dummy won't sell at all to smaller countries._

It's exactly consistent with general tax law in the US and internationally.
It's not practical, but that's the price you pay for choosing to make money in
another taxing jurisdiction. If you don't want to deal with it, make money
somewhere else.

That being said, the US has a good treaty network so that the situation you
describe generally wouldn't result in income tax to the US seller unless they
had a physical presence in the country of the buyer. Which is exactly why the
French tax at issue is an excise tax (not subject to treaty restrictions) and
not an income tax (covered by treaty restrictions).

~~~
d1zzy
> No, it would be more like your company going to France, selling the French
> guy the game, and then coming back to the US. The burden of tax compliance
> is placed on you, the seller, because you are the one profiting from the
> activity and therefore morally (and legally) should shoulder the burden.

I don't think that's as clear as you try to make it be. Both parties (seller
and buyer) are doing something that is in their best interest, one is
acquiring a product/service for some money, the other is selling it for the
money. In both cases it serves their interests, both have a moral
responsibility in regards to the exchange. And you see this reflected in tax
laws too where both companies and consumers pay taxes relevant to a
transaction.

~~~
gamblor956
I'm an international tax lawyer dude...

The seller is making money. That's what matters from a moral and legal
perspective. _Everywhere._ It doesn't matter that the buyer is possibly also
getting a benefit.

 _And you see this reflected in tax laws too where both companies and
consumers pay taxes relevant to a transaction._

Please list even one location where both the buyer and the seller pays the
transaction tax. Here's a hint: there isn't one. Either the buyer pays, or the
seller pays. However, for nearly every transaction tax, the _seller collects
the tax on behalf of the government_ and remits that amount to the appropriate
tax authority. (In Hawaii and Australia, the seller actually pays the tax--GET
or GST, respectively-- but is permitted to pass along the tax to the customer
as a separate line item on the invoice. In Hawaii, the seller then owes more
tax for the additional charge to the customer.)

Note also: withholding taxes on cross-border payments are not transaction
taxes. They're income taxes, which is a very different thing.

------
umeshunni
Interestingly, the only recent French tech company to be even remotely
globally relevant (Criteo), is also affected.

[https://en.wikipedia.org/wiki/List_of_companies_of_France](https://en.wikipedia.org/wiki/List_of_companies_of_France)
is a good list to look at. There is only one other software/internet company
founded in France since 2000 in the 'Notable' list - 360Learning. About a
third of the list was founded before 1900. A very different list than what
you'd see in the US.

~~~
bojan
Sogeti is also very large, founded in 2002.

~~~
umeshunni
Looks like they were acquired by Capgemini

~~~
user5994461
It's not a tech company. It's a contractor body shop, like Accenture.

Sogeti merged very soon after it was formed. It's never really been known as
its own company.

------
wazoox
The US has long been using their legal system to skew free market rules and
favour their domestic markets and companies.

DoJ is constantly "exporting" US law around the world by methods that border
blackmail or even sometimes taking hostages.

Fighting back has been long due. Though of course France should begin with EU
free-riders, Luxembourg and Ireland...

~~~
pas
> DoJ is constantly "exporting" US law [...]

Could you explain what do you mean by this, and provide specific instances?

~~~
wazoox
For instance the 1977 (79?) law against corruption of foreign officials has
been in almost all cases involving large companies, only been used against
foreign ones, except in once case, Halliburton. In fact in that very case
Valourec (French) was working on a common contract with Halliburton and was
attacked first, but they negotiated by implicating their partner (both were
punished).

Concerning US embargoes, the DoJ has extorted many billion dollars from
foreign companies for breaking these. However there was no embargo between,
say, Germany and Iran; as some transactions happened to be in USD, DoJ
consider that Deutsche Bank, by providing services priced in US$ to Iran,
violated the US embargo. Ditto other European banks. This looks like
blackmail: US Treasury grabbed more than USD 14 billions from European banks
using this tactic. Also the US blocked various arms sales between various
countries because the weapons used some US-made parts (typically some
electronic chip deep inside), only to keep the deal to themselves.

Basically that means that any company making transactions in US$ must comply
to US law, always and everywhere. If my company sold some product to some
Russian company with a price in USD, it could be sued by a US prosecutor. Then
when visiting a friend in the US, I could be jailed (even if I hadn't no
direct relation with the targeted sale, simply as a company board member or
manager).

If my product includes any US-made part, my international sales are depending
upon US goodwill. Which, in the case of billion-dollars contracts, will
probably enter the scene.

Seems preposterous? It actually happened many times. It happened to the VP
Asia of Alstom, jailed nearly 4 years in the US to blackmail his company for
the sole benefit of General Electric. One of Deutsche Bank VP was extradited
from Croatia to the US while on holidays, and jailed in a high security prison
like a murderer. Etc.

------
csomar
This is a stupid move. The tax is not payed by big tech giants. Not by both,
either. It's complicated and depends on who needs whom the more.

If there are no alternative to AWS, Google Adsense, or an American SaaS in
France; the French people will be paying all of the tax. The big tech giants
will just slap them with a 3% surcharge for being in France.

This is different from US-China tariffs. If the US can source from other
suppliers, the Chinese will need to lower their prices. Effectively making
them pay the tax. It is a complicated and messy situation.

The big tech giants are named that way because they are big and dominant. This
makes them able to make the rules and circumvent the current ones. You'll need
the whole EU (or maybe the EU/USA) to get them in line.

France has been digging its own graveyard for a while. It seems that they
didn't learn their lessons and now going full speed. If you are a French
startup, you'll be less competitive. People hate paying more and it's not
clear if they can deduct this tax (like VAT).

~~~
toomuchtodo
This would incentivize competitors in France. That’s a good thing for France.

~~~
cyrksoft
With that argument, protectionism will incentivise competition. So why don’t
we close the economy a bit?

~~~
toomuchtodo
Whether you're /s or not, I wholly agree; I both fully support using public
policy, tariffs, and other economic mechanisms to support "at home" companies
over those abroad, as well as supporting local labor over that outside the
country.

If internet companies are the future of the economy (see: Stripe's opinion),
why _wouldn 't_ you do everything you could as a country to support your own
companies?

~~~
cyrksoft
Because protectionism isn’t only economically bad but also immoral. You can’t
force everybody else to pay higher prices.

Supporting your own companies at the expense of the rest of the society isn’t
good. You’ll be forcing consumers to pay higher prices for a completely
nationalist reason.

No reasonable economist would favor protectionism.

~~~
effie
Strawman, nobody is arguing for supporting companies at the expense of the
rest of society. The parent is arguing for supporting companies for the
benefit of the society. Both can happen, it depends on how and to what extent
it is executed. Economists disagree a lot and they have only partial say in
policies, countries are not run solely by economists.

~~~
cyrksoft
“For the benefit of the society”

How would you measure that? Does paying more for a worse product and raising
the price of the better one benefits society?

If the product was better it would already be in the market.

~~~
toomuchtodo
How much oil has been burned without paying for its environmental costs? Does
that make it a better product? That’s the point. Cheaper does not necessarily
mean better.

~~~
cyrksoft
We are not talking about environmental externalities here. That’s another
issue altogether. B

What are the negative externalities of AWS and the likes?

You cannot compare pears with apples.

------
jbigelow76
Good. Next step, have EU countries come up with an estimation of the value of
their citizens' private data that FB and Google gobbles up and tax them on
that too.

Edit: companies -> countries

~~~
dahfizz
Does that mean that EU citizens should also pay for these services? Or do you
expect these companies would continue to operate in the EU with no net profit.

~~~
noir-york
> Does that mean that EU citizens should also pay for these services?

Making people pay to access Facebook etc would be the best possible move for
society ever.

~~~
vuln
I would agree. Even something as low as $1 a month or $10 a year would change
everything.

------
dustinmoris
Previous discussion:
[https://news.ycombinator.com/item?id=20409591](https://news.ycombinator.com/item?id=20409591)

~~~
clamprecht
It's interesting to compare the general sentiment of the comments on that
post, which was posted 8 hours earlier than this one. Presumably those
comments are more from Europeans, and comments in this post are more from
people in American time zones.

------
pbalau
Who is this going to affect? The business:

1) between Facebook/Google and advertisers based in France?

2) between Facebook/Google and any advertiser as long as the ads are shown to
people in France?

3) between Facebook/Google and any advertiser as long as the ads are shown to
French people?

If it is the first, then I don't really see a problem. FB and co can either
stop doing business directly with French advertisers, or eat the tax, or
increase the prices.

If any of the others, then how would one go about determining how much money
to pay without infringing on people's privacy? What would stop FB from either
declaring a token amount of "business done in France - as per the options 2
and 3" or even say no business happened? How would the French gov check that?
Get the list with all ads shown by FB over a month along with who they showed
the ad to so the gov can check if those people where in France or not?

~~~
baud147258
> Get the list with all ads shown by FB over a month along with who they
> showed the ad to so the gov can check if those people where in France or
> not?

I think it would be closer to checking which French company bought ads from
Facebook and for how much and taxing this.

~~~
pbalau
This is the case no 1 in my post. What you quoted refers to points 2 and 3.

~~~
baud147258
Sorry, I misread your post. I think that the tax don't apply for points 2 & 3,
since it only concerns revenus made in France.

------
dahdum
This tax is on sales and not profits, so won't it just become another line on
the bill for French consumers? I imagine they'll just break it separately from
VAT.

Retroactively they'll have to eat the cost though.

~~~
bagacrap
Yes, but only for larger tech firms, so this will somewhat level the playing
field between large and small companies (offsetting the economies of scale
that larger firms benefit from). This would hypothetically lead to greater
consumer choice, which is probably a good thing.

------
ezoe
What happened to a company who has no physical presence in France refuse to
pay the tax on the ground that France has no jurisdiction upon them?

Ordering French ISPs to block the web service of that company thereby breaking
the fundamental human right of freedom of speech and no censorship.

~~~
WaylonKenning
I'm not sure that fundamental right is correct, at least, outside of America.
There's no fundamental human rights of freedom of speech and no censorship in
New Zealand for example, as enshrined by law.

~~~
alkonaut
There are no freedom of speech laws that would apply to a _corporation_ rather
than a human, that I know of at least.

~~~
M2Ys4U
Newspapers etc. regularly use Article 10 (freedom of expression) of the
European Convention on Human Rights to protect their ability to publish.

~~~
alkonaut
That freedom of expression is for the journalists, not the newspaper - that is
my point.

------
r00fus
I'd guess it's even more palatable for France if the US threatens. The
combativeness from the US helps foreign leaders to look stronger by creating a
nationalist confrontation.

Is this tax functionally different from tariff?

~~~
Xixi
Given that French companies are also affected, I fail to see how it could be
construed as a tariff. The goal of tariffs is to penalize foreign
corporations. That tax is directed at a sector. It will not help the few
French actors in that sector become more competitive.

~~~
r00fus
It will create a local market opportunity if FB, etc, pull out. See Austin vs.
Uber - the absence of ride-shares launched local alternatives that quickly
took that marketshare until the locality changed it's stance.

It will likely act much like a tariff as I doubt any of these megacorps will
pull out.

------
julienfr112
There may be a complication : As EU is a single market, US retaliation (except
maybe on Champagne and Camembert ...) cannot be targeted on France but on the
whole EU. For example, Airbus headquarter is located in the Nederland, and has
factories all over Europe. As such, EU will have to enter a fight a single
country started. I really wonder what will happen next. Maybe Texas could
raise the tax on red sole shoes
[https://www.google.com/search?q=red+sole+shoes](https://www.google.com/search?q=red+sole+shoes)
?

------
rdm_blackhole
As much as I support governments cracking down on companies trying to dodge
paying taxes, I can't help but feel like this is just for show.

Since the yellow vests protests started last year(yes, they are still
happening, although the number of protesters has been decreasing rapidly), the
French government has been under pressure to stop taxing the middle class and
go after other entities/individuals to raise money.

It is no secret that France and most of the developed world is technically
broke. With a debt to GDP ratio approaching 100%, the French leaders have to
find money quickly or the whole welfare state will come to an end sooner than
later.

Considering the fact that this tax is supposed to bring in 400m per year, it
is basically a drop in the ocean.

But, what will happen is that Macron will spin it as a success and will tell
people: "See we are taxing the bad guys."

In the meantime, he will keep on increasing the taxes on the middle class
covertly.

The problem is that in a normal functioning democracy, the proceed of the
taxes is used to increase the well being of the population.

In France though, all new taxes raised are not used to create or maintain
infrastructure or even subsidize basic services for its citizens.

Most of the proceeds are actually used to pay off the debt. See the carbon tax
from last year when the government admitted that only 50% would be allocated
to actually fight climate change and the rest would be used for some other
unrelated things.

France as a whole has never been more taxed than now, and yet public services
and public infrastructure(or whatever is left of it, after they nearly sold
everything to private corporations) is falling into disarray.

Emergency rooms are closing(They have been on strike for the last 3 months
now), social services have been cut back, roads on the countryside are full of
potholes, electricity/gas prices keep on increasing.

The middle class is being bled dry by an overzealous state that does not know
what to do anymore to fix the problems it created in the first place.

For the last 30 years politicians from all sides of the political spectrum
have done one thing and one thing only. Instead of reforming, they just tax,
tax and tax more. Until there nothing left.

That's why France is dying. That's why people like me who do not like what
France has become have left to create companies/ pay taxes somewhere where I
don't feel like I have to share 50% of my money with a state that provides
very little to me.

------
sarcasmOrTears
Taxes are never fair, that's why you'll never agree on them. It's a game of
coercion and the only thing that can be done is choose who's the sucker that's
gonna pay.

Taxing big, multi-national companies is something that I can live with,
strangely. I know it's wrong, but still less wrong than having poor/middle-
class directly pay the bill. In the end they have the money to pay tax
consultants and the money to deal with it.

------
peteretep
I think the Brexit negotiations have probably shown Europe the power of
sticking together, and presumably France feels that the rest of the EU has its
back here.

~~~
baud147258
No, EU isn't backing this, because in that case it would have been an EU-wide
tax, not in just in one country. The EU tried to establish an equivalent tax,
but there was pushback from countries that are taking advantage of it
(Ireland, Luxembourg)

Edit: From the French newspaper Le Monde [1], it was Ireland, Sweden, Danemark
and Finland which opposed the idea. And from this article [2], Germany didn't
help a lot, fearing tariff on their car industry.

[1][https://www.lemonde.fr/economie/article/2019/07/11/le-
parlem...](https://www.lemonde.fr/economie/article/2019/07/11/le-parlement-
francais-adopte-definitivement-la-taxe-gafa-contestee-par-les-etats-
unis_5488135_3234.html)

[2][https://www.lemonde.fr/idees/article/2018/12/06/taxe-gafa-
un...](https://www.lemonde.fr/idees/article/2018/12/06/taxe-gafa-une-nouvelle-
occasion-manquee_5393487_3232.html)

~~~
peteretep
I think this will play out differently, and doubly so if American sabre
rattling continues

------
buboard
I just hope the US does not "retaliate" on this. EU entrepreneurs are too
dependent on US businesses.

~~~
glerk
I really wish US companies would take a more forceful approach with these
rogue governments. “You get off our back or we pull out of your countries”

~~~
levosmetalo
I would be happy if those spy organisations like Google and Facebook would
leave my country.

~~~
magduf
Google provides some genuinely useful services, like Maps.

Facebook, on the other hand, isn't something that anyone really _needs_. What
value does Facebook actually provide anyway, besides giving people a forum to
post boring family photos for grandma to look at? I guess Facebook Marketplace
can be sorta useful for selling your old junk, but that's the only thing that
comes to mind.

Remember also that there's only two players in the smartphone market: Apple
and Google (which makes the software and app store behind Android). If you
loose Google and Android, that means everyone's going to be sorta forced into
buying an iPhone unless they want to go back to flip-phones. Do you really
want an Apple monopoly in your country?

~~~
buboard
Facebook provides the great service of keeping them all over there. Imagine if
all that crowd descended on HN.

~~~
magduf
Don't be silly. Even if FB disappeared tomorrow, "that crowd" isn't going to
come to HN, just like they're not going to suddenly develop an interest in,
say, electronics and start hanging out on message forums where people talk
about how to design PCBs, or an interest in, say, astrophysics, and start
hanging out on message forums where people talk about gravity wave detection.

No matter what happens to FB, you're safe here.

------
Hithredin
Very interesting comments that reflects the difference of values between
french and north americans!

------
whb07
Absent all this talk about fairness or not, if one were watching CNBC today,
Cramer and the other analysts were asking themselves "what exactly is France
selling to the U.S" and this is the list they came up with:

1\. cheese 2\. wine 3\. ....

After a couple minutes on the discussion, they came up with Airbus (not
strictly French and made outside of France).

------
bfrog
Please do this in the US, and use the money to fund the green new deal.

------
_zachs
Amazon should and probably will just raise prices for French shoppers.

------
vansteen
Btw, on a tax manner, are these companies really American?

------
pkaye
> The French government has argued that such firms headquartered outside the
> country pay little or no tax.

Isn't that largely due to EU laws and the decisions of Ireland and a couple
other countries.

~~~
99052882514569
Let's say it is. Why would that change anything? France's government isn't
trying to target or punish anyone (whether Ireland or Google), it just wants
to stop the corporate tax avoidance it sees as unfair.

~~~
buboard
What you call avoidance is the essence of EU. Undoing that would bring us back
to pre-EEC situation

~~~
99052882514569
Tax avoidance via jurisdictional arbitrage is certainly _not_ the essence of
EU.

~~~
buboard
Cross border trade is. And digital businesses , finance, shipping , and many
more will increasingly become remote. Right now EU artificially inflates local
presence with regulations (by e g not having a bank union). Like it or not
though, free trade zone means that taxes wont be paid uniformly. I know that
tax avoidance is seen as unfair but it was enabled by the Union.

~~~
effie
Cross border trade does not require allowing for the tax avoidance. And the
E.U. is changing, just because something was enabled long time ago does not
mean it will remain the same. Free trade zone can have many forms.

~~~
buboard
And yet they couldn't find a way to have both without imposing this tax.

------
alwayseasy
European regulations and taxes always come up in these threads and some
libertarians complain about how it's an unfair way to treat a digital company
that shouldn't pay taxes.

Just remember that the United States are subsidizing tech companies (tax
amnesties) and all the upside (high salaries, innovation, stock market growth
etc...) is going back to the US while the downside of tech companies
(electoral manipulation, teen depression, tax avoidance, privacy breaches) is
only felt in Europe with no upside.

~~~
bacon_waffle
In addition, the United States is exporting its tax system around the world
and imposing costs on the rest of the world in the process via FATCA and FBAR.

------
cyrksoft
Aren't they already taxed in Ireland, another EU country? Isn't this double
taxation?

~~~
effie
Yes, France wants money too. Not unreasonable, considering the companies'
activities involve French infrastructure and French citizens.

------
jplayer01
This entire thread shows how much of a waste of time it is discussing taxes or
government or social services (socialism!) or markets with Americans. They
have such an incredibly skewed point of view based on an insanely unfair and
unjust system of everything in the US.

------
maitredusoi
Amusing to read political comments on HN ... It is like discussion about
programming laguages, just church wars ....

------
alt_f4
Trump is right on this one -- this measure is definitely anti-competitive and
specifically aimed at American tech companies. I hope he is swift to retaliate
with appropriate tariffs. Failing to do so will bring a wave of random EU
taxes on American tech companies, which will eventually lead to lower profits
and engineer salaries.

~~~
simion314
How, did you forgot how big US is? We are reminded here on HN how big US is,
so it is natural that some US companies will also fall into that tax laws.
What will Trump do? tax smaller companies so non US ones are hit harder ?

Off topic, did the China tariffs had any good side effect so far?

~~~
fiter
Arguably the China tariffs are resulting in manufacturing being distributed to
other countries. This could be considered a good side effect from a fault
tolerance perspective.

~~~
simion314
Agree, also China,India and other countries will invest more into reducing
their dependencies on US which is as you said good from a fault tolerance
perspective

~~~
fiter
This trade war might help Chinese capital equipment manufacturers as they can
sell to the new factories in other countries.

------
simplecomplex
Instead of taxing companies because it’s an easy method to steal money, maybe
France should focus on enabling their people to create a company like Amazon
or Facebook and actually generate wealth instead of taking it?

~~~
effie
Why wouldn't they do both? "Stealing" money via taxation is a legal and
logical way to get some money to support their other operations, perhaps even
"enabling their people".

