French President Nicolas Sarkozy declared Wednesday that "Internet Giants" should pay taxes in France, shortly before a meeting with Twitter founder Jack Dorsey. Sarkozy stated that "it is unacceptable that they have a turnover of several billion euros in France without paying tax," and suggested that the French government should consider taxing online advertising revenues.
Last year French lawmakers rejected the taxation of said ad revenues, fearing it would hurt small, local businesses, more that it would the internet giants like Google, Facebook and Twitter. At this, a Google spokesperson stated that "the Internet offers a wonderful opportunity to generate growth and jobs in France," and cited a report by management consultant McKinsey showing that said Internet giants contributed 60 billion euros ($78 billion) to the French economy in 2009. The Google spokesperson added, "this positive contribution would have a better chance of coming about in an environment that is supportive of the web in France and of investment in the sector. Public policy should support this,"
Dorsey was in Paris to meet with Sarkozy, along with other French presidential candidates, where Sarkozy urged Twitter to base their European operations in France. Dorsey responded positively to this invitation, and Sarkozy added that France should not "only be a consumer of digital products, but a creator of digital technology and innovative methods" and noted that both Google and Microsoft had recently opened offices in France.
One would think that Sarkozy would at least allow Facebook to be off the tax hook, after the company allegedly helped him to design his Timeline.