The French government is planning to stand before the country's electorate in May 2019 with one concrete result at European level: the introduction of a tax for electronic platforms.
I intend to step up contact with my opposite numbers to explain why we need to tax digital platforms in order to “make progress next month and reach an agreement by the end of this year at the latest”, the French finance minister, Bruno Le Maire, said in Luxembourg on Monday 1 October, upon his arrival at the Eurogroup meeting.
The minister, who is expected to raise the matter the same evening over dinner with several Nordic countries, has rejected all objections that have been made. Germany, which withdrew its agreement in principle on the creation of a tax in Vienna (see EUROPE 12092), is still asking to see the details of the tax. Sweden and Denmark are concerned that the initiative may aggravate transatlantic tensions. Ireland, mobilised by Brexit, will be the hardest member state to win over, as it is still rejecting the principle of tax harmonisation of European level.
“None of [these objections] holds water”, Le Maire responded. He considers that the Trump administration “only respects strength”. To the great satisfaction of Luxembourg, France has said that it is prepared to introduce a sunset clause to replace the legislative proposal on the table with an international solution at OECD level. “The short-term solution cannot be valid permanently, as it taxes the turnover, whereas a tax should tax profits”, Pierre Gramegna said.
Le Maire has said that he is prepared to make progress on the OECD's BEPS action plan a priority of the G7, to be hosted by his country in 2019. “But there will be one condition: the taxation of the digital sector must be adopted”, he stressed. (Original version in French by Mathieu Bion)