Mere hours after a French Socialist Party amendment instituted per-gigabyte taxes upon “platforms” for sending data to French users, French activists are demonstrating their ability to rack-up €10,000 daily costs in “taxes” to be paid by arbitrary French websites — including political parties
[All English translations via Google Translate or Twitter, by source]
Friday: The goal of the amendment was both straightforward and boldly naive: institute a tax upon free-to-use foreign platforms such as Facebook by co-opting ISPs to determine which “platforms” are serving data to French end-users, and attribute a “tax” of €0.055 (5.5 euro cents) per gigabyte of data transmitted by the platform.
https://www.assemblee-nationale.fr/dyn/17/amendements/3210A/AN/1358
” Tax on digital data producers”
” Art. 302 bis ZP . – A tax is established based on the flows of digital data emitted by content providers and paid by the latter.
” Art. 302 bis ZQ . – Internet service providers and any company offering an internet access service to households and businesses shall implement, under the supervision of the Regulatory Authority for Electronic Communications, Postal Services and Press Distribution and the Directorate General of Public Finances, a procedure for the consolidated and anonymized collection of the quantities of data passing to their customers by identifying the sender of this data.
“The data collection is carried out according to technical procedures defined by decree. It includes the identity of the issuing company, its registration number with the Internet Assigned Numbers Authority, and the quantity of data transmitted during the period in question. No statement regarding the content of the data or its destination may be required. This data is transmitted quarterly to the Directorate General of Public Finances.”
See more information at the link above.
The amendment’s proponents continued that platforms such as Facebook are “free to use” and therefore there would be no costs passed on to the consumer:
Laurent Lhardit, the originator of the amendment, believes that this tax cannot be passed on to the consumer since Facebook is “free.”
Even for Facebook, it will be passed on to the advertisers, and thus to the customers of those advertisers who do not use Facebook.
This point in particular was raised by VideoLAN – the French project which provides the world with the popular VLC video player – who in some incandescent tweets took issue with supporting politicians, who themselves in turn attempted to trash VideoLAN’s position:
Critics of VideoLAN’s tweet — including the sponsoring politician — say that the tax will be “capped by a percentage of turnover” although it’s not clear (and the amendment itself does not say) precisely how that will impact open-source projects or any other “high-bandwidth low/zero-turnover” websites and services, or whether they will be taxed and then have to somehow claim the money back, and/or whether their existence will be chilled.
VideoLAN robustly defends itself:
You have no idea what you are talking about. What you said about Facebook and Insta and other social networks are not targeted because they are free, means you don’t understand the basics of economy. You don’t understand the difference between Revenue and Profit. Nor what is a non-profit. You don’t understand anything about digital economy and digital business models. You don’t understand anything about security and updates. You should be ashamed of yourself.
And impact on Steam is noted:
12€ in tax for downloading GTA VI. They live in a parallel world.
In more detail, Elodie Aishwarya Remoissenet analyses the “big picture” as follows:
Elodie Aishwarya Remoissenet @getbarkley
1/ Thank you, we have read the text in full. And it’s even worse than what @videolan said. Let’s do the math with your own figures.
2/ Your presentation: 200 billion GB per year to French subscribers, 10 billion euros in expected revenue. France has about 30 million connected households. That comes to 330 € per household per year. Two and a half times the old TV license fee.
3/ “The cap protects.” So choose: either the cap bites, and your 10 billion evaporates; or the 10 billion holds, and the cap protects no one. The two can’t both be true at the same time.
4/ “It won’t affect the consumer, @facebook is free.” When a sender pays, it passes it on. It’s written in your presentation: CDNs and transit providers “pass on or do not pass on the tax.” Pass it on to whom? To the host. Who passes it on to the startup. Who passes it on to the internet user.
5/ The sender is identified by its “registration number with the IANA.” The IANA doesn’t register companies: in Europe, network numbers are assigned by @ripencc. And a single CDN address serves thousands of sites, including VLC and any French startup. You can’t distinguish @netflix from the neighborhood association.
6/ Groups without an entity in France receive “a tax notice.” And if they don’t pay? Nothing. Those who will definitely pay are those with an entity in France: French hosts, French startups. Exactly the opposite of the stated objective.
7/ “Ecological virtue”: video is already compressed to the maximum, it’s the core of the business. The only compression left is to lower the quality. You’re not taxing waste, you’re taxing the definition of the image.
8/ And “at most 15% of revenue in France or 2% of total revenue”: which of the two? The text doesn’t say. A tax law that doesn’t know how to state its own cap.
9/ You write it yourself: video and gaming “structurally” have a lot of data per euro. You know it, and you still vote for a volume-based tax. Volume is usage. In the end, it’s the internet user who pays. Always.
Source: Amendment No. 1358, PLF 2027, text and summary presentation (Pappers Politique) #TaxeGigaoctet #PLF2027 #frenchtech #OpenSource
The above is a fairly complete analysis, although I have not yet seen mention of how VPNs and Tor Project Proxies would/will be billed – presumably they, too, would be entirely chilled as they would be a “source” of gigabytes without attribution / chargeback to a “source” platform for the actual content. This would support European “age verification” and “digital identity” initiatives intended to remove online anonymity.
Protest
On Sunday we started to see the first active protest: people searching the websites of the parties and politicians behind the amendment, iteratively downloading the largest files they can find, again and again:
Good evening @LaurentLhardit! After 214,683,917 downloads of your personal site (https://laurent-lhardit.fr), that’ll come to €10,237.20 to be paid. You can go to the nearest Public Treasury office. We can round it up to 20k; it’ll just take a few more hours.
It’s Sunday, I’m bored. So, I found a PDF on Marc Bloch on https://parti-socialiste.fr that’s 44MB. A little script that downloads it, deletes it, re-downloads it, and counts what that costs the PS. With every like, I repost the result.
In cybersecurity this kind of activity is called “jackpotting” (even in French) by analogy to artificially forcing a casino gambling machine to repeatedly pay out its jackpot prize until the machine is empty.
So on top of economic illiteracy and deception regarding costs to consumers, extensive technological self-harm and “chilling effect” impediments to digital sovereignty, in pursuit of “€10 billion per year” in additional taxes, the French government has just handed their famously direct citizens the ability to charge any French political party — or any other organisation — some 15% of their annual turnover, simply as the cost of having a website online.
Il n’y a pas assez de pop-corn au monde pour savourer ce spectacle.
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