David Lawder and Andrea Shalal for Reuters:
The U.S. government on Monday said it may slap punitive duties of up to 100% on $2.4 billion in imports from France of Champagne, handbags, cheese and other products, after concluding that France’s new digital services tax would harm U.S. tech companies.
The U.S. Trade Representative’s office said its “Section 301” investigation found that the French tax was “inconsistent with prevailing principles of international tax policy, and is unusually burdensome for affected U.S. companies,” including Alphabet Inc’s Google, Facebook Inc, Apple Inc, and Amazon.com Inc.
U.S. Trade Representative Robert Lighthizer said the government was exploring whether to open similar investigations into the digital services taxes of Austria, Italy and Turkey. “The USTR is focused on countering the growing protectionism of EU member states, which unfairly targets U.S. companies,” Lighthizer said.
The findings won favor from U.S. lawmakers and U.S. tech industry groups, who have long argued that the tax unfairly targets U.S firms. “The French digital services tax is unreasonable, protectionist and discriminatory,” Senators Charles Grassley and Ron Wyden, the top Republican and Democrat, respectively, on the Senate Finance Committee, said in a joint statement.
MacDailyNews Take: As we wrote back in April:
As per the EU itself, the smart approach for Apple et al. is to lobby for harmonized EU taxation over a state-by-state patchwork of taxes, as that will at least offer simplicity, stability, and predictability.
Certainly E.U. taxation policies have zero resemblance to equality and fairness for far too long. Fingers crossed the Trump administration will be a catalyst for positive change for American tech companies…
Why exactly were the comments above not favorable? Perhaps there are a lot of French visiting the site and they agree with the French taxing policies?
No, lemme guess, if GoeB would NOT have included Trump in the post, “will be a catalyst for positive change for American tech companies…” the words would have been just fine, or even desirable.
To some, Trump tarnishes even the good things, I guess. Let’s just say that’s simply irrational.
“To some, Trump tarnishes even the good things, I guess. Let’s just say that’s simply irrational.”
It’s the smell….
“It’s the smell…” Lemme guess…
Would that smell be of “Walmart” shoppers?!?
No “Art of the Steal” types.
👍🏻. What GoeB said.
Sounds like an overreaction to country making tax decisions in its own borders:
France’s 3% levy applies to revenue from digital services earned by firms with more than 25 million euros ($27.86 million) in French revenue and 750 million euros ($830 million) worldwide.
We all know that digital service companies have got away with paying minimal taxes in countries outside the US. For once I agree with the French that this needs to stop.
I hardly see that this action is protectionist. It is simply reacting to the inequities of the taxation systems for multinationals and digital service companies in particular. Slapping punitive duties on French physical products is a classic example of unreasonable, protectionist and discriminatory.
Is the administration going to punish individual States within the US for wanting to do the same thing as France and from before France said they might?
Specifically, the collection of sales tax from online shopping.
“As per the EU itself, the smart approach for Apple et al. is to lobby for harmonized EU taxation over a state-by-state patchwork of taxes, as that will at least offer simplicity, stability, and predictability.”
So individual EU States should give up their sovereignty for US corporation’s benefit and convenience? Nice try. If you want to sell in their country, you must play by their rules.
As I’m told frequently… “use an Android, no one is forcing you to buy Apple”. Well no one is forcing you to sell in the EU.
The WHOLE point of the EU is for the member states to give up some sovereignty in exchange for the economic benefits of having EU-wide, unified, simplified, commerce system.
France doing its own thing in this instance is absolutely brain-dead, even if they are justified in wanting to correct an unfair tax situation.
Each EU country can tax EU outsiders as they see fit, provided it’s the same for all.