France To Levy Tax On Web Advertisers – Proceeds to Support Music

Good news for French musicians, bad news for internet search giants. French Premiere Nicolas Sarkozy is deliberating the recommendations put forward by a select committee to combat the deleterious effect new methods of music consumption are having on the French music industry. With Gallically direct logic, the report advocates sidestepping the whole tricky process of charging ISP’s and banning file-sharers and taxing the easy targets, those who make most from internet traffic, the big search engines and websites. If enacted the French would charge Google, Facebook, Yahoo and anyone else who makes money from advertising on computer screens in France between 1% and 2% on each ad or sponsored link clicked or displayed. The sidestep may not be as neat as M. Sarkozy could hope, however, as taxing websites whose financial base is in another country raises a whole slew of other legal problems. It seems unlikely that Google et al will allow themselves to be milked in this way, given that they are already under fire from the British Government for not declaring their UK taxable income properly.

If the proposals are enacted, and revenue starts flowing, the French Government hopes to raise between 20 and 40 million Euros a year, which it will pump into the music business in various ways, such as Government subsidised vouchers and cards for purchasing music online.

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