French economy ministry to propose tax hike on Internet box

8th September 2010, Comments 0 comments

The French economy ministry is to recommend that the sales tax on devices bundling Internet, television and fixed telephone services be raised to 19.6 percent, a move that could earn the state several hundred million euros, a ministry source said Wednesday.

"This is the approach that will be submitted to the president of the republic and the prime minister in the coming days," the source told AFP.

At the moment, half the cost of subscribing to the combined services is subject to a sales tax of 5.5 percent and the other half to a tax of 19.6 percent.

The economy ministry would also like to apply the single 19.6 percent tax to mobile telephone operators who can now benefit in certain cases from the reduced rate on grounds that television programmes can sometimes be viewed on mobile phones.

The ministry estimates the unified tax could earn the state "several hundred million euros" in additional revenue at a time when the government is looking for nearly 4.0 billion euros in its 2011 budget.

© 2010 AFP

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