The Strategist

US launches investigation of French tax on IT giants

07/11/2019 - 11:39

The US Trade Representative has launched an investigation into plans of the French government to impose a tax on companies providing digital services, according to a statement by Head of Department Robert Lighthizer.

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The document states that the US president ordered to study consequences of such a step and check whether the tax is not discriminatory or unreasonable, and whether it restricts the trade of the United States.

Lighthizer expressed concern that the proposed tax was "unfairly aimed at American companies."

As expected, the Senate of France will approve introduction of this tax at a meeting on Thursday.

The French tax on digital services will be 3% per annum on the income of digital companies whose annual sales worldwide exceed € 750 million and € 25 million in France. It is assumed that the tax will affect several US technology giants, including Apple, Google and Amazon.

The US Trade Representation will assess the French tax in accordance with section 301 of the Trade Act of 1974. President of the country Donald Trump has previously used this provision to impose duties on imports of goods of Chinese origin, citing threats to national security.