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France to control U.S Tech. giants with Germany’s help

France to control U.S Tech. giants with Germany’s help

PARIS: France is working with Germany and other partners to plug loopholes that have allowed U.S. tech giants like Alphabet Inc.’s Google, Apple Inc., Facebook Inc. and Inc. to minimize taxes and grab market share in Europe at the expense of the continent’s own companies.

France will propose the “simpler rules” for a “real taxation” of tech firms at a meeting of European Union officials due mid-September in Tallinn, Estonia, French Finance Minister Bruno Le Maire said in an interview in his Paris office on Friday, complaining that Europe-wide initiatives are proving too slow.

“Europe must learn to defend its economic interest much more firmly — China does it, the U.S. does it,” Le Maire said. “You cannot take the benefit of doing business in France or in Europe without paying the taxes that other companies — French or European companies — are paying.”

The push reflects mounting frustration among some governments, regulators and, indeed, voters, at the way international firms sidestep taxes by shifting profits and costs to wherever they are taxed most advantageously — exploiting loopholes or special deals granted by friendly states.

The European Commission last year ordered Apple to pay as much as 13 billion euros ($15.3 billion) plus interest in back taxes, saying Dublin illegally slashed the iPhone maker’s obligations to woo the company to Ireland. Apple and the Irish government are fighting the decision.

Macron is also cutting taxes on financial wealth, dividends and capital gains, while simplifying labor rules as he tries to make the country more attractive for investors. The government will also reform the pension system and unemployment benefits, and will seek to boost housing construction to reduce real estate prices, the minister said.

Le Maire rejected the idea that his government’s intervention in corporate decisions amounted to protectionism, saying Macron only decided to block Italian shipbuilder Fincantieri SpA’s bid for French shipyard STX last month because it was of strategic importance to France.

Talks with Fincantieri are continuing and France aims to find a solution by the end of next month, Le Maire reiterated. He said he hopes for closer cooperation between French and Italian military shipbuilders and, ultimately, the creation of a “large European naval group” based on a Franco-Italian alliance.