Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

France’s digital taxman goes after Amazon — again

France’s digital taxman goes after Amazon — again

The US tech giant scored a victory narrowing a French digital levy that lawmakers are now trying to overturn.

Amazon won a key battle against France’s digital tax earlier this year. Now, the country’s taxman is out for revenge.

France's digital tax was announced with much fanfare in 2019 as a way of netting revenue from Big Tech platforms. But Amazon has since scored a major success that has narrowed the levy's scope, according to a previously unreported decision from the French top administrative court in March.

While the tax still targets online marketplaces and advertising, the Council of State ruled that other activities such as online multiplayer games and services between two companies of the same group should be left out — unlike what France's tax authorities had written in their guidelines.

Now, the Senate is trying — with the government’s backing — to make up for it through amendments voted over the November 19-20 weekend in parliamentary discussions on France’s 2023 budget.

"Few people noticed the [March] decision, which is quite technical," said Laurence Mazevet, tax partner at KPMG Avocats. "We expected the tax authorities to seek to change the law, because the Council of State's decision minimizes the levy’s impact.”

The digital tax targets companies with an annual global turnover of €750 million and at least €25 million in France. This covers, among other companies, Google, Facebook, Apple and Amazon, and the French government expects the tax to bring €670 million to public coffers in 2023. Paris has pledged to scrap its national levy as soon as a global deal on the taxation of corporate giants actually becomes reality, which is happening very slowly.

In France, Amazon was one of the staunchest opponents to the national scheme and the first tech company to announce it would pass on the costs to sellers.


Three wins


In 2021, Amazon challenged the tax authorities' guidelines on the digital levy, arguing that they go beyond the law. Administrative guidelines on taxes provide further explanation on legislation but can be brought before the Council of State when taxpayers deem them unfavorable.

While it's unclear how much money Amazon has saved or will save, the administrative court's decision is a political victory for the U.S. tech giant.

"There are three issues on which Amazon won. Each time, it was because the tax authorities had misinterpreted the law," said Edouard Milhac, an associate at CMS Francis Lefebvre Avocats.

The top administrative court effectively reduced the tax's scope and required the French economy ministry to pay Amazon €3,000 in compensation.

The ruling is also a pleasant surprise for companies such as Epic Games. The top court said the tax shouldn't cover online multiplayer games. Intermediation services provided by companies of the same group shouldn't either. And it limits the tax base by cutting out logistic services provided by online marketplaces.

Tax lawyers Milhac and Mazevet said the decision opens the door for claims from companies who overpaid from 2019 to 2021. Amazon did not say whether it had followed the administrative guidelines and would seek reimbursement.

An Amazon spokesperson referred POLITICO to a March 2022 statement saying the Council of State’s decision "confirms that the interpretation by the French tax authorities goes far beyond the scope and intent of French law."

“Amazon pays all the taxes that it is required to pay in France," the statement continues, estimating the company's contribution in France at more than €1 billion in 2021 in direct and indirect taxes.


Two losses


The Council of State's decision did not fall on deaf ears. Over the weekend, the Senate quietly adopted an amendment to the French 2023 budget that overturns two of Amazon’s wins.

The proposal drafted by the budget’s rapporteur — Jean-François Husson from the conservative party Les Républicains — enshrines in the law the inclusion of multiplayer games and intra-group services when they are also provided to external companies. However, senators didn't add revenue from logistics to the tax base.

The amendment, which would come into force on December 31, is likely to impact companies beyond Amazon.

Husson and government spokespeople did not reply to multiple requests for comment. The tax authority declined to comment.

The Senate moved to expand the levy with the government's blessing. “This amendment is a timely clarification of the digital tax’s conditions of application,” Industry Junior Minister Roland Lescure told lawmakers ahead of the vote.

The budget still needs to go back to the National Assembly, but the government's backing means the Senate's amendments will likely be in the final text.

Lawmakers wanted to “clarify the law,” the Senate official said; “the digital tax was always meant to be extended.”

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
The Personality Rights Challenge in India’s AI Era
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Study Finds No Safe Level of Alcohol for Dementia Risk
Trump Says Ukraine Can Fully Restore Borders with NATO Backing
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Germany Weighs Excluding France from Key European Fighter Jet Programme
Cyberattack Disrupts Check-in and Boarding Systems at Major European Airports
Björn Borg Breaks Silence: Memoir Reveals Addiction, Shame and Cancer Battle
When Extremism Hijacks Idealism: How the Baader-Meinhof Gang Emerged and Fell
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
Trump Orders $100,000 Fee on H-1B Visas and Launches ‘Gold Card’ Immigration Pathway
France’s Looming Budget Crisis and Political Fracture Raise Fears of Becoming Europe’s “Sick Man”
Three Russian MiG-31 Jets Breach Estonian Airspace in ‘Unprecedentedly Brazen’ NATO Incident
European manufacturers against ban on polluting cars: "The industry may collapse"
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
U.S. and China Agree on Framework to Shift TikTok to American Ownership
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
The New Life of Novak Djokovic
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
France Faces New Political Crisis, again, as Prime Minister Bayrou Pushed Out
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
France, at an Impasse, Heads Toward Another Government Collapse
×