Facebook’s French branch has agreed to pay €106 million in back taxes and penalties, according to a report by French news magazine Capital.
Facebook France is to pay 104 million euros, of which 22 million is for penalties. The decision resulted in a loss of 88 million euros for the French division of the multinational company, according to its 2019 financial results, Capital reports.
The Ministry of Finance has focused on all major internet companies, demanding to pay tax on the profits made in France. It has already reached an agreement with Google that it will pay a billion euros to the French treasury, and a settlement of half a billion euros with Apple.
Last year, France was the first major economy to approve a special 3% digital tax not only for large technology companies referred to in France as GAFA (Google, Amazon, Facebook, Apple). However, Washington protested against its introduction, saying it targets American companies.
Last month, the US announced an additional $ 25 billion in tariffs on French goods in retaliation for the digital tax. However, Washington postponed introducing these tariffs by 180 days to allow time to resolve the dispute.
European countries plan to collect a pan-European digital tax but have not yet agreed on it. In the Czech Republic, the governing coalition resolved in June to the 5% rate of the originally planned 7% digital tax rate.