France’s “Google tax” – Sounds like protectionism
A report has been made public proposing that France begins taxing the likes of Google to subsidise its own creative industry. The authors of the report suggest that this new taxation could raise up to the equivalent of $28 million, which in the grand scheme of things isn't much money at all. The suggestion that the tax will help France subsidise music artists and book publishers doesn't therefore sound like the sole objective here, given that this amount of money won't make much of a difference if it's spread so thinly across France's creative community. On this basis it feels like protectionism of the worst sort - instead of collaborating with successful, innovative companies, or creating an environment that promotes innovation domestically, France appears to want to give its own industries an unfair commercial advantage by taking money from non-French firms. If the proposals are made into law, this then obviously sets a precedent which would allow France to raise this taxation as it saw fit and usher in a period of conflict between the French government and some of the world's most innovative online firms.
It is of course understandable why France would be concerned, particularly given that Google has approximately 98% of the search engine market in that country, but instead of treating successful companies as the enemy it should look to the music and publishing industry to reinvent themselves and offer the consumer an alternative to Google et al. Google and other ad-driven websites exist because they offer something of value to the consumer. If the creative community have left a vacuum in terms of how they serve the needs of their online-loving consumers, and then this vacuum is filled by the likes of MySpace and Google, then the blame shouldn't be put at their door. Punishing innovators for innovating is a very short sighted stance to take.