Google, Facebook, Amazon will testify against France's digital tax next week

The tech giants will present their case on Monday.

Shelby Brown Editor II
Shelby Brown (she/her/hers) is an editor for CNET's services team. She covers tips and tricks for apps, operating systems and devices, as well as mobile gaming and Apple Arcade news. Shelby also oversees Tech Tips coverage. Before joining CNET, she covered app news for Download.com and served as a freelancer for Louisville.com.
  • She received the Renau Writing Scholarship in 2016 from the University of Louisville's communication department.
Shelby Brown
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Tech giants are rallying against France's digital tax.

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Google , Facebook and Amazon  are set to testify against France's digital tax next week, according to a Wednesday report from Reuters. On July 12, the French Senate approved a 3% tariff on big tech companies providing services to French users, with the Trump administration at the time saying it would investigate whether the move amounts to unfair trade practices by discriminating against US companies.

The digital tax affects companies that make at least €750 million in revenue worldwide -- around $844 million, £690 million and AU$1,230 -- as well as €25 million in digital sales in France. The US investigation into France's new rules will be conducted by US Trade Representative Robert Lighthizer. It'll be a 301 probe, the same kind that led to tariffs being placed on China last year.

In Google's written testimony, Nicholas Bramble, the company's trade policy counsel, said that France's digital tax threatens to undermine the Organisation for Economic Co-operation and Development's (OECD) process.

"It is a sharp departure from long-established tax rules and uniquely targets a subset of businesses. French government officials have emphasized repeatedly that the DST is intended to target foreign technology companies," Bramble said.

After the Office of the US Trade Representative announced its investigation, Facebook said tax policies should provide certainty for businesses to operate domestically and abroad. 

"We continue to support multilateral approaches like that being undertaken at the OECD. We welcome USTR's approach to thoughtfully examine unilateral measures that discriminate against US companies and could stifle innovation," Facebook's said in its statement. 

Amazon told Reuters that the French tax could cause problems for their respective business models. The Information Technology Industry Council, which represents Amazon, Facebook, Apple , Google and others, will testify Monday that the tax is "a troubling precedent," according to the report.

"The United States is very concerned that the digital services tax which is expected to pass the French Senate ... unfairly targets American companies," Lighthizer said in a statement last month. "The president has directed that we investigate the effects of this legislation and determine whether it is discriminatory or unreasonable and burdens or restricts United States commerce."

The UK first announced a similar digital tax last October. At the time, the UK Government's economic and finance ministry tweeted that the tax was meant for tech giants to shoulder, not tech startups.

Apple and Amazon didn't immediately respond to requests for comment. 

Watch this: Squashing censorship by satellite TV

Originally published Aug. 14, 2:39 p.m. PT.
Update, 3:27 p.m.: Adds response from Google. 
Update Aug. 15: Adds Facebook's statement. 

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