French Gov: Tax Online Ads, Funds Creative Sectors

2 minute read
Marisa Peacock avatar

Recent reports about a plan to tax online advertising revenues for those in France have garnered attention.

Raising Money to Support Creative Sectors

The plan, proposed in a government-sponsored research paper, wants to raise up to €50 million (US$ 72 million) a year to aid creative sectors, such as the music industry, which has struggled to adapt to new media distribution. They are struggling, the report claims, because news aggregating entities like Google, Microsoft, AOL, Yahoo and Facebook are profiting from their work without paying for it.

The report, which lists 22 different ways to improve the sale of online content, would essentially make it so that 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.

In response, Google has contested the claims, saying that it already provides a platform where customers can find publishers more easily and distribute their material to a wider audience.

Learning Opportunities

A Hidden Agenda?

The report is hardly written from an unbiased perspective, however. One of its main contributors, Patrick Zelnik, has a vested interest; he is the founder of the French Prime Minister's wife's record label, and a former music executive at Polydor and Virgin France.

While it’s unclear if the proposal will be accepted and how it will be regulated, it is clear that the distribution of creative content in the digital age is coming under scrutiny and may face a future of regulatory standards aimed at balancing out their role in the economy.