French digital tax may kill VideoLan non-profit
France’s National Assembly has advanced an amendment that would tax content providers €0.055 per gigabyte of data delivered to users in the country, potentially applying to everything from video streaming and game downloads to open-source software like VLC. Commenters argue the levy could make many online services unprofitable or push them to block French users, while also questioning how traffic origins would be tracked, how peer-to-peer or CDN traffic would be treated, and whether non-profits or low‑revenue entities would be exempt. The proposal is widely seen as a desperate attempt to raise revenue amid France’s fiscal and demographic pressures, with critics warning it effectively amounts to “banning the internet” if implemented as written.
Scope and Mechanics of the Proposed Tax
- Amendment would tax downstream internet data to French users at €0.055/GB (≈€55/TB).
- ISPs must measure traffic to French households/businesses, identify the “content provider” origin, and report it so the provider is billed.
- Uploads are reportedly excluded; focus is on data delivered to end users.
- “Content and application providers” are mentioned; French wording is ambiguous between “both” vs “either” content and apps.
- Some note a 2% cap relative to a company’s revenue (exact base unclear).
- Earlier draft was rejected; a newer version was adopted at committee level but still faces several legislative stages.
Impact on VideoLAN and Other Services
- Some commenters don’t see how a media player like VLC is affected; others say any download (e.g., VLC binaries) to French users would generate taxable traffic.
- There is disagreement whether French non-profit associations are effectively exempt (because they can’t earn profit) or still exposed.
- One estimate (from a translated article) suggests VideoLAN’s claimed “millions” in cost implies large annual traffic to French users, though exact figures are unclear.
Economic and Business Consequences
- Many argue €0.055/GB makes subscription video streaming uneconomic, especially for flat-rate, unlimited services.
- Example: 4K video at ~7 GB/hour would incur ~€0.38/hour in tax; heavy use (e.g., families, binge-watching) could erase or exceed margins.
- Large downloads (games, OS/software updates, backups) would incur substantial per-download taxes (e.g., ~€11.5 for a ~210 GB game).
- Some predict major platforms (Netflix, YouTube, Steam, etc.) would restrict service quality, block French users, or exit the market.
Feasibility and Enforcement Questions
- Major confusion about how to attribute traffic in P2P, torrents, multi-hop hosting (VPNs, seedboxes, mirrors), encrypted archives, anonymous uploads, and user-generated content.
- Concerns that trying to chase the “true” origin would be legally and technically intractable and encourage tax evasion.
- Several commenters doubt such a poorly specified scheme can actually be implemented at scale.
Political and Fiscal Context
- Many see the proposal as a desperate revenue grab driven by France’s high deficit, aging electorate, and reluctance to cut social spending.
- Debate over whether the move is “well‑intentioned stupidity” vs a pure shakedown of “digital giants.”
- Some suggest better alternatives: taxing online ads directly or taxing long-term storage of user data instead of raw bandwidth.