Leosghost - 9:22 pm on Oct 31, 2012 (gmt 0)

Our current government is not made up of the sharpest knives in the box..direct taxes are not high..indirect taxes ( cotisations ) on businesses are incredibly high..
But there are no business people in our current government, who see businesses and the self employed as "vaches à lait" ( cows to be milked ) to pay for the salaries and pensions of civil servants ( of which France has a huge number, nearly 4 million even if you leave out the military ) and over 6 million of them retired..

We would have no deficit if it were not for the documented waste and corruption, primarily perpetrated by the members of the current Government and their friends when they were last in office, and their friends who are currently in office inn the regions..

But as they promised to "soak the rich and the evil businesses" ( and to get rid of the only government in 50 years who tried to rein in the waste and deficit and numbers of shiny trousered sinecured civil servants ) and give the money to the "down trodden civil servants"..it got them a lot of votes from that sector..enough to start looking for targets, and new cows to milk..

Having just given 7 Billion to their friends the bankers of the Peugeot car company..they now need to find some extra money..taxing G is legal under existing French tax laws* ( and G and others in the tech sector based in Ireland have been "taking the piss" tax wise over their operations in Europe ), and this will play well with an uninformed French audience..which has latent xenophobia ( especially towards non French multinationals ) which does not take much scratching to bring to the surface..

Minitel was very expensive and crap..minitel pron ( 3615 ) is what made the fortunes of the guys who are behind my French ISP ( Free )..I still have a minitel somewhere..

*French tax laws says basically that it is not where you base your company for tax convenience / avoidance which counts..If you do most of your business in France..or have an office in France ( Google does )..that it is in France that you'll pay taxes on any money gained from your French customers..

That is the way I'm taxed on my French business..
My UK business pays UK taxes on what it takes in in the UK from UK customers..
Likewise if I take in money from Irish customers vi a company in Ireland ( I'm Irish )..I'll pay taxes in Ireland..

It has always been that way..previous French Governments considered that although Google was "taking the piss" with their Irish operation invoicing everyone, but the actual business being done in each country such as France..that taxing them would probably net France less than turning a blind eye..

The new lot are desperate to raise money, ( because they are hiring new civil servants ( who will vote for them ) every day )..so they are now considering applying existing tax laws to Google..

Google's problem will be if the other EU governments decide to do the same, now that France may be beginning the process..Google pay very little tax at all in the UK ( despite making around 10% of their annual earnings there )..the USA may also decide to get tough on Google and MS and HP and other multinationals etc etc ..and tax them as they do other American businesses, rather than continuing to allow the sleight of hand that they allow at present of taking in money via Ireland and then moving it all over into tax havens in "bluewater lagoon banks"..

* disclaimer..I'm Irish..and my wife is a French civil servant..we are based in France..I am being objective, and providing some background..not political..