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France needs to re-think digital tax
09.47 Europe/London, November 21, 2011 By Robert Briel
“Our competitiveness is at stake,” write the CEOs of France’s four biggest operators, France Telecom/Orange, SFR, Iliad and Bouygues Telecom in an open letter in Le Monde.
The four want the government to rethink the so-called COSIP tax, which is used to help fund the French movie industry, and contributes to the budget of the state broadcaster France Televisions.
“Driven by a genuine political will, the telecommunications industry have raised France in the forefront of the digital world,” according to Jean-Bernard Lévy, Xavier Niel, Stéphane Richard and Olivier Roussat.
“Our country today can boast of a particularly dynamic telecommunications industry, competitive and diverse, benefiting consumers and the economy. We are proud to employ more than 120,000 people in France, to contribute to the economy of our country up to 2.3% of GDP and to support a very diverse network of companies present on the entire territory.”
Not only does the government see telecoms operators as a rich source of income, but also it asks them to build new networks and cut prices at the same time, said the four CEOs.
The CEOs express surprise that only network operators are being hit, when the online services and equipment sectors, where foreign companies dominate, are nearly exempt from taxes and regulation.
The letter is expected to relaunch the debate on the so-called Google Tax, a proposed 1% levy on online advertising, which could generate between €10 billion-€20 billion in the first year. The operators say the only structurally viable approach is to expand taxation to the whole digital value chain and to all businesses that benefit from the growth of the sector.
Although the ISPs pay the COSIP tax, they are (partly) compensated for this burden by a lower VAT rate for the services over which they pay this dedicated levy.
09.47 Europe/London, November 21, 2011 By Robert Briel
“Our competitiveness is at stake,” write the CEOs of France’s four biggest operators, France Telecom/Orange, SFR, Iliad and Bouygues Telecom in an open letter in Le Monde.
The four want the government to rethink the so-called COSIP tax, which is used to help fund the French movie industry, and contributes to the budget of the state broadcaster France Televisions.
“Driven by a genuine political will, the telecommunications industry have raised France in the forefront of the digital world,” according to Jean-Bernard Lévy, Xavier Niel, Stéphane Richard and Olivier Roussat.
“Our country today can boast of a particularly dynamic telecommunications industry, competitive and diverse, benefiting consumers and the economy. We are proud to employ more than 120,000 people in France, to contribute to the economy of our country up to 2.3% of GDP and to support a very diverse network of companies present on the entire territory.”
Not only does the government see telecoms operators as a rich source of income, but also it asks them to build new networks and cut prices at the same time, said the four CEOs.
The CEOs express surprise that only network operators are being hit, when the online services and equipment sectors, where foreign companies dominate, are nearly exempt from taxes and regulation.
The letter is expected to relaunch the debate on the so-called Google Tax, a proposed 1% levy on online advertising, which could generate between €10 billion-€20 billion in the first year. The operators say the only structurally viable approach is to expand taxation to the whole digital value chain and to all businesses that benefit from the growth of the sector.
Although the ISPs pay the COSIP tax, they are (partly) compensated for this burden by a lower VAT rate for the services over which they pay this dedicated levy.