Big tech companies will now be required to pay a 3% tax of total annual revenues to the French government after a Bill targeting GAFA companies — an acronym for Google, Apple, Facebook, and Amazon — was passed on Thursday.
A new 3% tax will be applied to tech companies that make €750 million globally and €25 million in France from public advertising and digital intermediary services to consumers. Online businesses, digital services providers, in addition to companies that provide communication, payment, or financial services are exempt from the 3% tax.
The passing of the Bill comes a day after the US began its investigation under section 301 of the Trade Act 1974 into the then-proposed tax legislation. The US was concerned that the tax would unfairly target US tech companies due to them being global leaders in that market.
