Is this then to counter tax avoidance by companies that conveniently transfer the profits out of the country? "Oh no we made a loss in France so no tax to pay in France because we had to pay our Irish subsidiary €1bn for digital services".
I don't know if this is one of those cases but governments are generally trying to figure out how to avoid such transfers away of tax revenue.
A massive portion of our lawmakers are absolute clowns too, it's not exclusive to the US.
Note that this amendment to the law was passed with 11 votes for, 10 no... With a national assembly of 577. I have to assume it was voted at night, that's when peak democracy happens.
France is spiraling into a debt whirlpool needing to use debt to pay off debt, basically having no good way to resolve the issue without a lot of pain (“austerity”). Any politician with enough foresight to do what needs to be done gets removed, so those that remain are selected for their thick foreheads.
What’s more fun is that while france is teetering on the brink, it’s hardly alone, and it’s collapse will tip the dominoes.
Which was predicted by some economists from day one.
One economist wrote, before the first Euro even circulated: "The euro will lead to too many public servants in France, too many industries in Germany, too many vacation houses in Spain [1], the default of Spain on its public debt and then the default of Greece on its public debt".
When Greece, not Spain, defaulted on its public debt, that same economist: "I was only wrong about the order of defaults of Greece and Spain".
The Euro, he predicted, would be one of the shortest lived currency in the history of currencies.
His name is Charles Gave and he's gotta be 80 y/o old now. Of course people are going to hate on him and spill all their hatred on him because he's neither a communism nor a socialist.
And then idiots are going to say that "euro is great because I can travel and pay in the same currency everywhere". As if they're own little convenience warranted the disaster that we're heading into because ideologues, not economists, decided to force a currency down the throat of most european citizens.
[1] btw there are many protests in Spain now because "costs of rents are too high" (yeah, no shit: there's a gigantic number of empty houses and apartment in Spain belonging to foreigners, who only come a few weeks per year).
California has some fiscal problems but if any state hits a crisis point it will probably be Illinois first. US states don't issue their own currency and have limited ability to take on debt so even if California is forced to raise taxes and default on obligations that probably won't trigger a broader systemic collapse.
I kept posting about it here over the years but at officially 57% of the GDP being public spending (and the actual percentage is bigger than that because a great many of the "private" companies that are monopolies are basically owned by state apparatchiks), France is already a planned economy.
And there's only one outcome for planned economies and its misery.
And when socialists succeed in establishing misery, they've guaranteed themselves an endless stream of voters. And they can only drive the country more into the ground. So more misery. So more socialism. So more planned economy.
France "offered" fiber optic to the entire country (at taxpayers' expense) and now that people have big Internet pipes, they're going to implement Bill Gates' old dream [1]: tax every single packet of information.
What's up with France is socialism. That's what up with France.
[1] in a leaked memo when the Internet began to take off, Bill Gates explained he wanted to tax every single network packet (for those who remember).
Reading through an English translation of the article, it seems there is a cap?
> There is a cap so that services using a lot of bandwidth but earning slimmer margins are not crushed. The amount charged cannot exceed 15% of revenue earned in France, or 2% of worldwide revenue. Besides raising money, the authors present the tax as ...
How much does the VideoLan foundation make from France, as revenue?
How are they going to meter the traffic? Trust Netflix to report the numbers? (Pinky promise this is the true number;-)) Or request French ISP to monitor and analyze the traffic to know what went to which server?
EU and European countries are rent-seeking apparatuses whose only purpose is ensuring the status quo. Italy attempted to tax free cloud storage offered by providers such as Google, etc. to customers along with their own paid storage -- private storage is also, of course, taxed on purchase, for all hardware: from 5 to 30€ depending on capacity and intended use, because the citizen is automatically presumed to store copyrighted material on them.
Wait until you hear about Germany, where you have to pay a fee on all data storage media because it's possible that you might use it to copy something. It's awesome.
> I would be surprised if this law ends up being adopted.
It doesnt really matter. The damage is already done.
Macron tried to turn France (unsuccessfully one might say) into a country that is open to tech businesses. This law amongst other things (record tax rates, record deficit, weak economic growth, political instability, riots and much more) is simply another signal that opening a business in France today is just too risky and this will impact future growth for sure.
You have countries that look to the future and invest in it and then you have France.
I agree with most of what you said, but just want to point out that "riots" is much dramatized and overblown by the media. for what was mostly peaceful demonstrations, with a few nefarious actors (thieves, vandals, etc) using the chaos as cover, and in practice not much happened.
Now, in my opinon, the major issue with opening a business (regardless of the country) is that it is costly to do so, even if there are tax and state incentives. It's much easier to create a startup when seed funding is available.
> "riots" is much dramatized and overblown by the media
I don't think I can agree with you on that:
> On Oct. 21, French Economy Minister Roland Lescure said in an interview that the violence and unrest had caused “tens or perhaps hundreds of millions” of euros worth of damage.
Seems like overblown is not exactly the appropriate word here. Not too mention the the loss of reputation which could keep future tourists away from France, the loss of revenue from the shops that have had to close since they did not want to be looted or burned down and finally the loss of trust in the state's ability to maintain order.
> the major issue with opening a business (regardless of the country)
Well it is especially hard in France considering the record tax rates that France is imposing on its citizens. The cost to actually employ someone is high compared to many countries in the OECD.
Furthermore, the inability to reform the state to restore competitiveness won't improve in the near future whoever wins the presidency next year.
I asked Claude for some context and while I'm hesitant to simply parrot its claims, they seem reasonable:
This passed late at night with an 11 to 10 vote (the entire assembly is 577 people). Odd amendments like this apparently pass somewhat frequently in similar ways.
Even though it passed, it's likely to be killed by the more right-wing parties when it gets to the senate.
The worst part of this is that now everybody who writes comments on Hacker News will violently insist that every company and individual in the world has to pay this tax and that you'll be in big trouble if you don't.
I've already had enough endless discussions with people saying that the US government will jail and fine US individuals on the behalf of France and Germany if they don't put cookie banners on their websites...
I mean, I always try to see things through another point of view, but 0.055 euros per GB is just crazy. GTA is estimated to be 210GB, so to download it 1 time it would cost you 11 EUR, that's more than 10% the price of the product. Politicians are completely drifting apart from reality
This sounds ridiculous. What’s the point of such a high tax on a productivity-increasing service? Why tax specific things unless you want to discourage their use?
Does the French state believe that its sole purpose is to extract money from any possible source for the sake of it?
The average French retiree makes more money annually than the average French worker (who is the one paying the retiree). Any attempts to reduce the number or benefits of the former is met with riots. The French state represents the will of the French people, which in the limit, has a single luxury French bag salesman selling to a single rich tourist a bag for $400 b which is then used to pay for that years pensions.
The sole purpose of the French state is to delay the pension time bomb however possible so someone else is in charge and held accountable when it goes off.
even if content providers are paying - it still inhibits consumption as content providers simply pass the cost to the consumer.
imagine netflix vs megaupload. megaupload or any of those or torrents - they could be registered entities or none but they r not gonna pay. consumers will simply get their content from those sites vs the official ones.
show me the incentives and I will show you the outcome as charlie munger said.
As I understand it's mostly because it doesn't matter. It's not a standalone law, it's an amendment to the budget. Budget that has close to 0 chance to pass.
I believe they did the same thing last year. Everyone did their own pet amendments, claimed victories. And then when it was time to vote for the budget with all the amendments, the assembly unanimously voted against, scraping the whole thing.
Thank you for sharing. I saw some outrage discussions on social media concerning this, and it's unfortunate how far people are willing to spin this to feed their narrative.
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[ 2.8 ms ] story [ 10.8 ms ] threadMaybe focus on the riots in the streets and sort that out vs wasting energy on nonsense like this. Just saying.
I guess at least it's capped somewhat? Is there more background preceding this legislation?
This seems as ridiculous as having 1TB internet caps for residential ISPs in 2026.
Dear Netflix, my startup is Uber but for carrier pigeons. Carrying SD cards! With AI-optimized routing because I gotta mention AI somewhere...
I don't know if this is one of those cases but governments are generally trying to figure out how to avoid such transfers away of tax revenue.
that could be done directly by taxing IP licensing directly
Note that this amendment to the law was passed with 11 votes for, 10 no... With a national assembly of 577. I have to assume it was voted at night, that's when peak democracy happens.
What’s more fun is that while france is teetering on the brink, it’s hardly alone, and it’s collapse will tip the dominoes.
Something to look forward to, I guess.
It's not great, but it's not even clearly worse than the situation Greece survived. https://think.ing.com/articles/carsten-intro/
Be fair, sometimes it's communist revolution.
One economist wrote, before the first Euro even circulated: "The euro will lead to too many public servants in France, too many industries in Germany, too many vacation houses in Spain [1], the default of Spain on its public debt and then the default of Greece on its public debt".
When Greece, not Spain, defaulted on its public debt, that same economist: "I was only wrong about the order of defaults of Greece and Spain".
The Euro, he predicted, would be one of the shortest lived currency in the history of currencies.
His name is Charles Gave and he's gotta be 80 y/o old now. Of course people are going to hate on him and spill all their hatred on him because he's neither a communism nor a socialist.
And then idiots are going to say that "euro is great because I can travel and pay in the same currency everywhere". As if they're own little convenience warranted the disaster that we're heading into because ideologues, not economists, decided to force a currency down the throat of most european citizens.
[1] btw there are many protests in Spain now because "costs of rents are too high" (yeah, no shit: there's a gigantic number of empty houses and apartment in Spain belonging to foreigners, who only come a few weeks per year).
California, for example.
I kept posting about it here over the years but at officially 57% of the GDP being public spending (and the actual percentage is bigger than that because a great many of the "private" companies that are monopolies are basically owned by state apparatchiks), France is already a planned economy.
And there's only one outcome for planned economies and its misery.
And when socialists succeed in establishing misery, they've guaranteed themselves an endless stream of voters. And they can only drive the country more into the ground. So more misery. So more socialism. So more planned economy.
France "offered" fiber optic to the entire country (at taxpayers' expense) and now that people have big Internet pipes, they're going to implement Bill Gates' old dream [1]: tax every single packet of information.
What's up with France is socialism. That's what up with France.
[1] in a leaked memo when the Internet began to take off, Bill Gates explained he wanted to tax every single network packet (for those who remember).
Not saying that this is not a stupid law nonetheless.
https://x.com/videolan/status/2116229135919919278?a=5Ua5pSOr...
See "tax incidence". Sales taxes are paid by businesses, and yet.
> There is a cap so that services using a lot of bandwidth but earning slimmer margins are not crushed. The amount charged cannot exceed 15% of revenue earned in France, or 2% of worldwide revenue. Besides raising money, the authors present the tax as ...
How much does the VideoLan foundation make from France, as revenue?
It doesnt really matter. The damage is already done.
Macron tried to turn France (unsuccessfully one might say) into a country that is open to tech businesses. This law amongst other things (record tax rates, record deficit, weak economic growth, political instability, riots and much more) is simply another signal that opening a business in France today is just too risky and this will impact future growth for sure.
You have countries that look to the future and invest in it and then you have France.
Now, in my opinon, the major issue with opening a business (regardless of the country) is that it is costly to do so, even if there are tax and state incentives. It's much easier to create a startup when seed funding is available.
I don't think I can agree with you on that:
> On Oct. 21, French Economy Minister Roland Lescure said in an interview that the violence and unrest had caused “tens or perhaps hundreds of millions” of euros worth of damage.
Seems like overblown is not exactly the appropriate word here. Not too mention the the loss of reputation which could keep future tourists away from France, the loss of revenue from the shops that have had to close since they did not want to be looted or burned down and finally the loss of trust in the state's ability to maintain order.
> the major issue with opening a business (regardless of the country)
Well it is especially hard in France considering the record tax rates that France is imposing on its citizens. The cost to actually employ someone is high compared to many countries in the OECD.
Furthermore, the inability to reform the state to restore competitiveness won't improve in the near future whoever wins the presidency next year.
This passed late at night with an 11 to 10 vote (the entire assembly is 577 people). Odd amendments like this apparently pass somewhat frequently in similar ways.
Even though it passed, it's likely to be killed by the more right-wing parties when it gets to the senate.
I've already had enough endless discussions with people saying that the US government will jail and fine US individuals on the behalf of France and Germany if they don't put cookie banners on their websites...
https://en.wikipedia.org/wiki/Indiana_pi_bill
Does the French state believe that its sole purpose is to extract money from any possible source for the sake of it?
Yes. French taxes are 43.5% of GDP in 2024, the second highest among OECD countries. <https://taxpolicycenter.org/statistics/oecd-taxes-share-gdp> US is 25.6%; Germany is 38%; Britain is 34.4%; Canada is 34.9%.
even if content providers are paying - it still inhibits consumption as content providers simply pass the cost to the consumer.
imagine netflix vs megaupload. megaupload or any of those or torrents - they could be registered entities or none but they r not gonna pay. consumers will simply get their content from those sites vs the official ones.
show me the incentives and I will show you the outcome as charlie munger said.
I believe they did the same thing last year. Everyone did their own pet amendments, claimed victories. And then when it was time to vote for the budget with all the amendments, the assembly unanimously voted against, scraping the whole thing.