France - Second Highest Tax Bill To Be Paid By Tech Giant

The French Microsoft subsidiary received a notification from the French tax competence. The multinational was required to pay a 600 million euros bill in France for its activities regarding online advertising and search engine. It is the second highest bill that French competence authority issued since the 1.1 billion one to Google in 2014.

Background

The French tax authority issued the reassessment based on Microsoft’s purchasing activity of online advertising banners or keywords on its Bing search engine and on Yahoo!. These transactions were carried out by Microsoft Ireland Operations, and the Microsoft France acted as a commercial agent in these businesses. In 2016, the US giant paid a tax amount equal to 32.2 million euros in France, and its French customers actually paid to the party located in Ireland where the tax rate is significantly lower than France.

Arguments from Both Parties

French tax authorities kept all the ongoing files secret, while Microsoft affirmed its act ‘in accordance with the laws and regulations in all the countries in which it operates, working in close cooperation with local tax authorities to ensure complete compliance with local laws’. French President Emmanuel Macron announced earlier this year that he would work to ensure internet firms pay a fair tax matching the business conducted in France.

Sources: lexpress(FR), rfi, worldnews.

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