France will impose a 3% digital tax, colloquially known as "Les GAFA" (after Google, Apple, Facebook, Amazon), on digital companies that have a revenue of more than €25 million in France, and more than €750 million worldwide irrespective of whether or not an international deal on such a levy progressed, French Finance Minister Bruno Le Maire said, per a Reuters report. This is similar to the 2% equalisation levy that the Indian government brought into effect on April 1, 2020, which is imposed on the sale of goods or services by a non-resident e-commerce operator in India. The Indian government had imposed a 6% equalisation levy on digital advertising services offered by non-resident providers in 2016. When this tax was approved in July 2019 by the French Senate, this was meant to be a temporary solution, a placeholder until the Organisation for Economic Cooperation and Development (OECD) reached an international agreement to overhaul its decades-old cross-border tax rules. Paris had reportedly offered to suspend its digital tax until the end of 2020 as an international deal was negotiated but the fallout from the COVID-19 pandemic upended those plans. OECD has moved the deadline for iron out the agreement from July 2020 to October 2020 because of the pandemic. India has, for quite some time now, seeking to tax digital companies on the basis of their economic presence. To that end, Finance Minister Nirmala Sitharaman had called for adoption of the “significant economic presence” concept to tax global digital companies at…
