by Jack H Barnes
Publisher & Global Macro Editor
Sacramento CA (DYDD)
Mon Dieu! Le Revenge of Minitel
The socialist government in France, scrambling to fund the deficits of the past, already on record for increasing taxes on its richest citizens 75%, has a new approach to revenue generation. They want to return to the past, and retroactively seek historical taxes on transactions of the past.
The latest news appears to be an escalation of an ongoing tax investigation into Google ($GOOG) and Amazon ($AMZN). France appears to be getting ready to sue the major web companies for historical taxes.
The government had decided, Montebourg said on France 2 television, “to launch tax retrieval procedures covering all of the Internet giants”.
The irony is that will most likely cause a burst of technology based M&A activity internationally. A secondary affect would be to pressure US gov to allow a window of time to return the off shore cash, before France can move to toward placing a claim on it.
This will ratchet up the pressure on large multinational companies to put their cash back to work. It doesn’t take a genius to see that large cash hordes are going to become the target of governments around the world looking for money to plug into their budgets.
France finally figured out a way to get paid for losing a war. Sue the winners.
