French tax authorities release Digital Services Tax guidelines

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April 2020

Overview

French tax authorities on March 23, released tax guidelines for the digital services tax (DST) enacted in July 2019 (Law #2019-759 published in the Official French legal Gazette on July 25, 2019). 

The 3% DST applies to companies that provide certain digital services localized in France with global annual revenue exceeding EUR 750M of taxable services and exceeding EUR 25M in France.  The tax is based on the amount, excluding VAT, that the taxpayer collects as consideration for taxable services provided in France since January 1, 2019.

The Guidelines are open for public consultation and comments until May 23, 2020.

The takeaway

DST taxpayers should review the impact of the Guidelines on their operations.  The Guidelines are opened to consultation and comments until May 23, 2020.  Only signed comments will be accepted by French tax authorities.

DST taxpayers should consider their 2019 balance payment obligations and the installment deferral applicable for 2020 (single installment due in December 2020) and keep appropriate information necessary to support their DST liability.  Also, DST taxpayers should monitor progress on the OECD Digitalization of the Economy initiative.

Contact us

Doug McHoney

International Tax Services Leader, PwC US

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