France ponders a 'culture tax' for digital device makers

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France ponders a 'culture tax' for digital device makers

France ponders a 'culture tax' for digital device makers
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The French government has said it will decide by the end of July whether to hit technology giants like Apple and Google with new taxes to fund the country’s culture.

It would be a one percent tax on the sale of devices like smartphones and tablets to help the French film and music industries.

That could reignited the debate on state intervention in the economy, but the Culture Minister Aurelie Filippetti said: “Currently the wealth created by the digital industry goes to the makers of these digital devices. Those devices happen to be imported, they are not made in France. And our creative industries – which are French industries – they get nothing.”

Filipetti added that the “culture tax”, which she said would be “minimal and widely distributed”, was likely to be included in a budget law to be submitted to parliament in November.

With more money being spend on hardware than content, sales of things like Apple’s iPhone and iPad and Google’s Android products, as well as so-called smart TVs, videogame consoles and ebook readers has a pre-tax total of 8.6 billion euros last year in France. A one percent tax would have raised 86 million euros.

The tax is one proposal in a report commissioned by President Francois Hollande on new ways of funding culture during an economic downturn.

Hollande’s office said in a statement that he wanted lawmakers to review legislation based on the report’s recommendations by the summer. Parliament goes into recess at the end of July and returns in mid- to late September.

Worried about being swamped by English language films and music, the French government has long pushed the“cultural exception” argument that its domestic industries must be shielded from market forces.

While far from becoming laws, the proposals could worsen tension between France and technology giants after Industry Minister Arnaud Montebourg blocked an attempt by Yahoo! to buy a majority stake in French video clip site Dailymotion.

That incident angered the firm’s French parent company and exposed discord between Montebourg and Finance Minister Pierre Moscovici, who denied having approved the move.