La loi relatif à la taxation des grandes entreprises
du numérique was enacted by France on
24th July, 2019 prior to the adoption of any uniform
OECD or EU initiatives in the area. France decided not to await the
introduction of the European Commission's proposal for a directive,
as distinct from a regulation (COM/2018/148) as that would take
considerable time. The tax is supposed to be a temporary
imposition, but as with most taxes, a Government's initial
declaration of intent is less than reliable.
It is in force, and the first tax date by which accounts
of turnover have to be prepared is 31st December, 2019.
Where an undertaking is subject to the tax, and the
group's or company's structure is outside the EU and is not in a
territory where there is a tax information exchange agreement
coupled with a functioning assistance and recovery agreement, a
fiscal representative resident in France has to be appointed. A
failure to do so will be subject to penalties, an immediate
investigation and taxation calculated on whatever information that
the French administration can muster.
Neither Guernsey nor Jersey have an agreement in place
with France which permits France to recover tax assessed and due.
The TIEAs do not contain any such provision, and were never
negotiated on the basis of assisting the French tax administration
to recover any tax assessed.
Channel Island trust companies involved in corporate
administration and management, their accountants, auditors and
compliance directors will need to check whether and if so to what
extent any undertaking sunder management is brought into the scope,
of the French tax.
It does not simply address Google, Amazon and Facebook.
Nor does it simply bring AliBaba into eth shearing fold. Any
business whose webpage can be accessed from a mobile smartphone,
telephone or computer in France could find themselves subject to
the tax where the use of their Website is significant, and the
turnover made in one calendar tax year sufficient.
What is more, Jersey Finance and the JFSC will also
need to consider whether their respective rôle of informing
representation and regulation have addressed this French
As a French trained TVA (VAT) lawyer, from the head office
tax department of a then nationalised French mutltinational and
previously a lecturer in French VAT at Saint Mary's College,
London, I am well placed to advise on the scope and application of
the tax from the French and also from the Crown Dependency
I can provide an immediate short executive summary setting
out the structure of the tax and its implications for a fixed fee,
which can then be fleshed out in further instructions can be
considered after the summary has been consulted. Please contact
Peter Harris on firstname.lastname@example.org
to take matters further.