France proposes to introduce user data collection tax

France is looking for new ways to raise funds and is disappointed that US technology companies leading the digital economy remain out of reach for French fiscal authorities. That is why the government is proposing a tax on the collection of user data.

The idea surfaced on Friday in a report prepared by President Francois Hollande. In his opinion, companies actively making money in the advertising market in France, such as Google, Amazon and Facebook, should leave an adequate portion of their profits in the form of taxes.
These companies receive a huge amount of information about their users, process and use for their own purposes. In particular, the data is used to target ads to a group of users according to certain parameters. The document says that personal data is used as the “raw material” for the digital economy. Moreover, users themselves openly share this data. Such openness of information allows Internet companies to earn billions of dollars in targeted advertising, which is estimated to be much more than banner ads.
“These data have different meanings, poorly reflected in economic science and official statistics,” the report said.
Google makes more than $ 30 billion a year from online advertising, including $ 2 billion in France. However, like other American Internet companies, he pays almost no taxes in France.
“We want to work and be sure that Europe is not a tax haven for certain Internet giants,” French Technology Minister Fleur Pellerin told reporters.
Forcing Google and other US companies to pay more taxes in France will not be easy and will take a long time, the report admits, because it will require international cooperation.
The report said that the tax rate will be based on the number of registered accounts that will be checked by external auditors.
Google replied that they are currently considering a nearly 200-page report.
“The Internet offers tremendous opportunities for economic growth and employment in Europe, and we believe that government policy should help ensure that growth is there,” the company said.

Taxes must be fixed by legislative acts, which, according to the government, will be submitted for consideration by the end of the year. However, another online advertising tax project that Hollande had previously advocated faced difficulties. The project for a tax rate of 75% on profits of more than 1 million euros was rejected by the supreme court of France, which called it discriminatory.

Any proposal to introduce taxes on the collection of personal information may also attract the attention of the French privacy regulator, who have expressed concern about the amount of data that companies such as Google and Facebook collect.
[ TheNewYorkTimes ]