Professor Mark Skilton from Warwick Business School comments on France passing a new digital services tax and the US administration's arguments that it unfairly targets American businesses.

He said: “A key point is this is hardly surprising given the Trumpian talk and policy of “America First” from the White House. If you look at these policy documents from 2016 onwards they contain no hint of collaboration or recognition of other people or countries that they have enriched themselves on, and seek to reinforce “American First” everything.

“These companies in the digital economy are not paying a true representation of the national tax in those countries that they dominate in. This French action is the most direct action to date to fix this, rather than seeking collaboration in the legal courts that get nowhere and treated as a game by the American lobbyists to delay. What do they expect? For example, GDPR does protect data rights but the basic problem of data access is still locked down by these American companies inspire of their filibustering in court and on the Hill. “American Last” policy is growing as a result, either from direct action like the French or as a longer term impact of alleged wrongs by some American current policy makers dressed up as “national security”, when the writing on the wall of the White House policies are all about entrenchment and nationalism.

“The French action on the problematic dominancy of American cloud computing and social media platforms has been a long time coming. Even with their US-own review of the dominance of these platforms, the Trump administration reaction is typical for its own interests perspective. The actions by the French and Europeans is a result of market forces that are seeking to make a more fair playing field for countries that have to deal with monopolies that own 80 to 90% of the real data traffic online. They (Facebook, Google, Amazon and others) respond saying they add more value and are “free” but the truth is one-sided, they are not free at all in the real sense of business market access and competition, with no consumer choice or no real consumer and business control over their own data.

“The French action I hope will be the first of many more, the tariff threats will come but the reality post Trump sooner in 2020 or later in 2024 is that the digital internet market will be reset by the many other countries that make up the world, not America, it’s just a matter of when.”

11 July 2019

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