Paris (AFP)

US digital giants report sales in France four times lower than actually achieved, generating a loss of one billion euros for the tax, according to a report released Wednesday by the former secretary of state to the digital Mounir Mahjoubi.

In 2018, the Gafam, which includes Alphabet - the parent company of Google -, Amazon, Facebook, Apple and Microsoft, declared in France 3.4 billion euros of cumulated turnover compared to 14.9 billion actually achieved, says the analysis note titled "Tax Hackers".

Mr. Mahjoubi, who is LREM deputy from the 19th arrondissement of Paris, deduces that the tax paid by these companies last year to the French tax authorities should amount to 1.16 billion euros, against only 130 actually paid, nine times less.

Many multinationals tend to inflate their turnover or profits in countries with favorable taxation, and on the contrary to minimize their activities or the gains collected where taxes are heavier.

Thus Facebook "has reported a turnover in Ireland of 18.7 billion euros but has only 3.1 million active accounts in this country.In France, his declared income falls to only 389 million euros for 38 million users, "says the report.

The report also notes that "Netflix has no establishment in France, so no sales or profits declared".

To fight against the erosion of the tax base usually calculated on profits, France has introduced this year a "Gafa tax" of 3% on the turnover of technology companies that generate at least 750 million euros in figures annual business.

This tax is supposed to be provisional pending the completion of a process of adoption of common tax rules within the OECD. In particular, these should require more transparency on transfer prices, ie the prices at which the subsidiaries of a multinational in different countries sell their products and services back to each other.

At European level, the Commission is working on a system of distribution of the tax base between Member States according to the origin of sales (CCCTB).

Mr Mahjoubi welcomes this reform process, which he still considers "too timid".

The deputy therefore calls on parliament to demand the giants of the tech but also the state "more transparency on the reality of digital activities in France."

© 2019 AFP