Sacre Bleu! France Mulls Tax On Web Ads To Bail Out Old Media
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Could operators like Google (NSDQ: GOOG) be taxed every time a Frenchman clicks a web ad? A report presented to the French government suggests exactly that.
The Zelnik Report recommends a levy on online advertising companies, as well as ISPs, to raise between €35 million ($50 million) and €50 million ($72 million) annually for media hit by digital, ie. news publishing and music
The paper, which suggested 22 different proposals to improve the sale of online content, was written by Patrick Zelnik (pictured) a former music executive at Polydor and Virgin France; the president of Sotheby’s France Guillaume Cerutti; and Jacques Toubon, a former minister. It names Google, Microsoft (NSDQ: MSFT), AOL (NYSE: AOL), Yahoo (NSDQ: YHOO) and Facebook among the companies that would be affected by the online advertising tax. “No profit without compensation,” Toubon tells Liberation.
Every time an ad or sponsored link is clicked in France, regardless of the origin of that advertisement, it would be taxed at a proposed rate of between 1 and 2 percent. ISPs would also face taxes based on their traffic.
Who would benefit? The other proposals include lower sales taxes for triple play services, compensating writers and other content creators, and selling cards for €20-25 that would give €50 in credits to young people to encourage them to buy legitimate content online.
The Zelnik report is not France’s first attempt at taxing ISPs, or indeed its first attack on Google…
—Last year, it proposed to levy a new tax on ISPs, mobile operators and commercial TV broadcasters to help fund public television, after it banned advertising on public TV channels.
—In September, Nicolas Sarkozy’s government appealed to the U.S. to intervene in a settlement between American publishers and Google, over the internet giant’s proposed digitized book project, citing too much subsequent control over European published works.
There is no given timetable for the government to act on these newest Zelnik proposals. But they seem even less likely to be implemented than Hadopi, the new agency France mandated last year to monitor ISPs for copyright abuse and warn, warn again, then disconnect freeloading customers. This is expected to be put into effect later this year if a state privacy body gives the green light.
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Posted In: Advertising, Legal, Regulatory, Companies, Google, Countries, Europe, France
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