French tax authorities have started demanding payment of instalments due for the current year under the digital service tax introduced in 2019, reports Le Figaro citing a government spokesperson. This follows the temporary suspension announced in January, when France's finance ministry agreed to put collection on hold until December, as part of a truce reached with the US administration. The spokesperson said that the government took seriously the threat of US sanctions due to come into effect is early 2021, in retaliation for the controversial tax.
An industry commentator told Le Figaro that imposition of the levy was the most effective lever the French finance ministry could pull to refocus international attention on a common tax solution for multinational companies, with a compromise possible by mid-2021. Earlier this year, the process to find a resolution via the OECD was derailed by the US administration’s decision to withdraw from talks. In 2019, France was reported to have collected EUR 350 million from the digital service tax, with receipts expected to increase in 2020.
