In response to the threat of a 301 investigation by the United States, France reminded its traditional allies that France is a sovereign country and that it does not accept attempts by other countries to use trade instruments to block their independently formulated tax policies. This is also the first time in the history of bilateral relations that the United States has used this means to deal with France.
It is worth noting that although the tax covers about 30 enterprises in the world, including Chinese and French enterprises, most of them are American enterprises, and even the name of the tax is directed at American enterprises.
France passed the GAFA tax and Britain said on the same day that...
According to Bloomberg local time on July 11, even if the United States hinted that it might use trade tools to deal with France, the latter did not abandon plans to tax companies such as Facebook and Google.
On Thursday, the French Senate passed a bill that would impose a 3% tax on businesses that provide digital services to French consumers, targeting companies with global revenues of more than 750 million euros and annual revenues of more than 25 million euros in France.
Fox Business Channel pointed out that the voting results showed that the bill had the support of both parties in France.
The tax law will go back to January 1, 2019, affecting about 30 businesses worldwide. Most of them are American companies, but they also include Chinese, German, British and even French companies.
However, the name of the tax law clearly points to GAFA Tax, which includes the abbreviations of American technology giants Google, Apple, Facebook and Amazon.
French President Mark Long still has two weeks to sign or amend the bill, while French President rarely amends laws passed by Parliament. This has happened only three times in the past 40 years.
With the passage of the bill, France will become the first EU country to collect such taxes, while other countries, including Britain and Germany, are considering similar tax policies.
The UK government plans to impose a 2% tax on revenue from search engines, social media platforms and online shopping platforms that derive value from UK users from April 2020, according to a draft budget released on Thursday.
France reminds the United States that I am a sovereign country
The day before the French parliament voted, the United States started.
The U.S. Trade Representatives Office announced on October 10 that Trump ordered the same day to launch an investigation into the French digital service tax in accordance with Article 301 of the 1974 Trade Act of the United States. The French tax law is unfair to U.S. technology companies, according to U.S. Trade Representative Lethizer.
In this regard, Reuters, CNBC and other foreign media generally believe that the investigation may lead to retaliatory tariffs or trade restrictions imposed by the United States on French goods, aggravating Global trade disputes, and 301 survey is the same kind of investigation that led to the United States imposing tariffs on China last year.
Amazon, one of the companies involved, praised the Trump governments statement that Frances tax revenue was poorly structured and discriminatory and would cause significant harm to American and French consumers.
We appreciate the decisive action taken by the Trump Administration against France and send a signal to all U.S. trading partners that the U.S. Government will not acquiesce in discriminating against the tax and trade policies of U.S. enterprises.
Although the United States rarely used 301 surveys to deal with its traditional ally France, which the Washington Post believed highlighted the Trump Administrations intention to continue to take a tough attitude on trade issues, France responded that its digital service tax conformed to international rules and did not accept attempts by other countries to use trade instruments to block it. Expropriation.
After the tax law was passed, Bruno LeMaire, Frances finance minister, said in a speech to the Senate: I am confident that our differences among our allies can and must be resolved in ways other than threats.
France is a sovereign country, independently formulating its tax policy, and will continue to make tax decisions independently.
Video screenshot of Lemel
Lemmel revealed that he spoke to U.S. Treasury Secretary Nuchin Wednesday and pointed out that this was the first time in the history of relations between the two countries that Washington had launched 301 investigations into France.
Frances condition for abolishing GAFA tax is that __________.
Reported that the passage of the tax bill and the United States investigation, may further increase tensions between countries on both sides of the Atlantic. The two sides are preparing to negotiate a limited trade agreement on industrial products, but there are differences between the United States and the European Union over whether to include agriculture in the final agreement.
France is the most resolute country against any concession in agriculture. Trumps threat to impose a 25% tariff on European cars cast a shadow over the negotiations.
However, the French government has its own interpretation of this digital service tax.
The message I want to convey to our American partners on Thursday is that this tax should encourage them to accelerate their work on International Digital taxation at the level of the Organisation for Economic Cooperation and Development (OECD).
The French government had asked the United States to cooperate with Europe in the Paris-based OECD to reach a fair digital tax.
In recent months, the pace of OECD negotiations has accelerated. Lemel reiterated that France would cancel the tax if an OECD agreement was reached. In May, he also expressed optimism about reaching an agreement this year. But the OECD has previously said that it will not be until 2020 to reach a conclusion on the so-called digital tax.
French government official website also reported on the digital tax passed on November 11, while saying that France has taken the first step before the international agreement reached, while saying that the tax is temporary, is waiting for an agreement at the international level. The government hopes to speed up OECDs work on Amending national tax rules.
Meanwhile, the United States pointed out that its trade representative, Robert Lighthizer, would spend a year studying whether Frances tax plan would damage American technology companies and propose remedies. In a statement Wednesday, Lethizer said the United States will continue to support the OECD in its efforts to reach multilateral agreements on tax issues in the digital economy. He hoped that countries would wait for a multilateral agreement to address the challenges to the international tax system posed by the increasing digitalization of the global economy. Next week, a meeting of finance ministers and central bank governors of the Group of Seven (G7) will be held in France, where participants will discuss international taxation, competition and the digital economy. This article is an exclusive manuscript of Observer. It can not be reproduced without authorization. Source: Author of Observer: Tongli Responsible Editor: Su Honghong_NBJ9980
Meanwhile, the United States pointed out that its trade representative, Robert Lighthizer, would spend a year studying whether Frances tax plan would damage American technology companies and propose remedies.
In a statement Wednesday, Lethizer said the United States will continue to support the OECD in its efforts to reach multilateral agreements on tax issues in the digital economy. He hoped that countries would wait for a multilateral agreement to address the challenges to the international tax system posed by the increasing digitalization of the global economy.
Next week, a meeting of finance ministers and central bank governors of the Group of Seven (G7) will be held in France, where participants will discuss international taxation, competition and the digital economy.
This article is an exclusive manuscript of Observer. It can not be reproduced without authorization.