Taxes, Taxes, Everywhere There’s Taxes

France recently passed a 3% digital tax that is supposed to apply to companies with over $845 million in worldwide digital service revenue and at least $28 million of revenue in France.  Online shopping, including Amazon’s marketplace, is included in the definition of digital revenue.  The hope of the tax was to “level the playing field” between large tech companies (especially those headquartered in the US) and small companies.  The US has complained that the tax unfairly targets US companies. 

Guess what?  Amazon just announced it is raising fees for its small business customers in France by 3%!  Shocking!  Did the French government really think Amazon and other large companies would pay more taxes and, as a result, accept a lower profit margin?  Amazon’s small business customers, like the jeweler profiled in the second link below, need Amazon more than Amazon needs them.  Somehow, the French government forgot who had the power in that relationship. 

When costs go up, the end user consumer ultimately ends up paying them.  It might take a while, but eventually companies pass increases on.  Taxes are a cost.  So are tariffs, even if Peter Navarro and President Twitter pretend they are not. 

https://www.cnbc.com/2019/07/11/france-passes-digital-tax-on-us-tech-firms-despite-trade-threat.html

https://www.cnbc.com/2019/08/19/amazon-blames-frances-digital-tax-for-higher-seller-fees.html

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