Like Google, Apple and Amazon previously, Facebook announced on Monday, August 24, a tax deal with the French government.

This agreement involves a €106 million corporate tax adjustment for its subsidiary Facebook France over the period 2009-2018.

For the year 2019, Facebook said it had paid €8.46 million in corporation tax, an increase “of almost 50% compared to the previous year”.

“We take our tax obligations seriously, we pay the taxes we owe in all the markets where we operate and work closely with tax authorities around the world to ensure compliance with all applicable tax laws and resolve any disputes,” Facebook said in a statement.

When asked, the Ministry of Public Accounts did not wish to comment, hiding behind tax secrecy.

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Tax on Big Tech

The agreement announced by Facebook settles several disputes accumulated by Facebook France but does not resolve the taxation of the digital industry leaders, which is the subject of international negotiations at the OECD and a heated dispute between the United States and France.

Paris, like many other capitals in Europe and around the world, believes that the amounts of taxes paid by Big Tech in the countries where they are active are often far too low, compared to their real impact on local economies.

On July 11, 2019, the French Parliament passed the final decision to introduce a tax on digital giants, based on turnover, pending an international agreement on the matter.

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US retaliation

But the United States has announced retaliatory steps following this French move, through additional customs duties on French cosmetics and handbags. These will amount to 1.3 billion dollars if they implement them in a few months.

To address criticism from the French government, Facebook announced in 2017 that it had “changed its sales structure” so that the turnover generated by its sales teams in France would be properly declared and taxed in France, by being included in Facebook France’s corporate tax calculation.

Facebook has paid 6.3 billion in income tax for the year 2019, but mainly in the United States.

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1 billion for Google, 200 million for Amazon, 106 million for Facebook

Since Emmanuel Macron came to power, the French government has settled several tax disputes with the American digital titans.

Almost a year ago, in September 2019, Google agreed to pay nearly €1 billion to settle all of its disputes with the French tax authorities.

As part of this agreement, the company had agreed to pay a 500 million euro fine to end an investigation by the national financial prosecutor’s office and to pay 465 million euro in tax relief to close the recovery proceedings against it.

In early 2019, Apple agreed to pay €500 million to settle 10 years of tax backlogs. Similarly, Amazon agreed to pay €200 million in February 2018.