Friday, November 11, 2016

The Google Tax, goes one step – Le Figaro

Against the advice of Michel Sapin, the finance committee of the Assembly adopted on Thursday the amendment socialist imposing a tax “on the profits diverted”, to fight against the tax optimization of multinational corporations.

In the framework of the review of the draft budget 2017, the finance committee of the Assembly adopted on Thursday the amendments to the socialist deputy Yann Galut introducing a “Google tax” against the tax optimization of multinational corporations. Thus, they have disregarded the negative advice of the minister of Finance, Michel Sapin, on the subject. “This is not a good solution,” he stated during a press conference Wednesday.

The amendment of the deputy of the Cher, created a “new tax on the profits diverted”. In concrete terms, this consists of a tax rate on corporations plus 5 percentage points (38,33 %). It would hit the multinationals caught up by the tax authorities for transfer-pricing “abusive”. This accounting technique is to make up the bulk of the profits of a French subsidiary to its parent company, installed in a high-tax countries more favourable. This tax on the profits diverted would also be applied to the multinational corporations, whose presence in France would be classified as “permanent establishment”. The definition of this concept, which gives rise to taxation in France of a company, would also be expanded.

Yann Galut has convinced his colleagues of the finance committee in presenting his amendment as “a strong political act” in order to “reintegrate the profits diverted in the tax base”. It is, however, committed to the reworking by the examination of the text in the session, next week. And this, in order to answer certain questions. Dominique Lefebvre (PS) said that the socialist group “shared the objectives” of the amendment, but has been very dubious about its “precise scope”.

in addition, the members of the finance committee have finally approved the extension of five to eight years the tax system in favour of impatriates. The rapporteur PS of the commission, Valérie Rabault, however, has supported the amendment for the abolition of the elected right-wing Jean-Christophe Fromantin. The topic causes strife to the left, as shown to the right…


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