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Targeted Measures Against Digital Giants
Major tech corporations will need to adjust their financial strategies. This Wednesday, the National Assembly’s Finance Committee agreed to an amendment that quintuples the digital services tax, commonly referred to as the GAFAM tax. Proposed by Jean-René Cazeneuve, this policy raises the current rate from 3% to 15% and increases the global revenue threshold for taxation from 750 million to 2 billion euros.
The aim is to ensure that digital behemoths like Google, Apple, Facebook, Amazon, and Microsoft contribute more, without harming French digital firms. We’re trying to avoid catching French players like Leboncoin in the net,
Cazeneuve explained to the committee.
Only companies with over 2 billion euros in global revenue will be affected. According to the legislator, this move could generate several billion euros in additional public revenue, at a time when the government is seeking new budgetary flexibility.
A Strategy of Reciprocity Against the United States
The amendment received broad support among the deputies. Deputy Denis Masseglia praised the measure as a reciprocal move against the tariffs imposed by the United States, asserting that France must now stand toe-to-toe with the US in economic matters.
Even among the opposition members, the feedback was generally favorable. We are outflanked on our far left by Mr. Masseglia and Mr. Cazeneuve, and that pleases me greatly,
joked Communist Deputy Nicolas Sansu, clearly pleased with the direction of the measure and the more aggressive stance towards American multinational companies.
An Alternative to Over-Taxing Large Corporations
This initiative is part of an economic strategy that opts to tax global giants rather than large French companies. On Monday, the deputies had already corrected a provision in the finance bill to exempt mid-sized businesses from an extraordinary profit contribution.
By focusing the fiscal pressure on foreign digital giants, the current government hopes to level the playing field and bolster public finances, while avoiding hindrance to national investment. Now, it remains to be seen whether this increased tax will withstand parliamentary debate and, more critically, potential American retaliation.