Gov looking to compensate for ad-ban
PARIS — French President Nicolas Sarkozy is expected to propose higher taxes on Internet service providers and mobile phone operators than those likely to be recommended in a government commission paper to be released on Wednesday, according to local reports.
The commission, chaired by Jean-Francois Cope, parliamentary leader of Sarkozy’s conservative UMP party, was set up in February to consider ways of making up the estimated E800 million ($1.25 billion) annual revenue shortfall expected once all advertising is banned from state-run networks.
The commission submitted its recommendations on both financing and programming changes to the national pubcaster group, France Televisions.
Citing unnamed sources, French business daily La Tribune says Sarkozy favors a 0.8% to 0.9% tax on the operators’ revenues as opposed to the commission’s expected recommendation of 0.5%
The higher tax rate would provide $524 million to $590 million in yearly revenues, as opposed to the $328 million that might be generated through the commission’s scheme.
La Tribune also reported that Sarkozy is expected to approve the commission’s recommendation of an increase in the annual TV license fee, indexed to inflation, after having publicly disapproved of the suggestion in May.
The newspaper indicated that the president will support beginning the two-step phasing out of ads in January, instead of the commission’s expected recommendation of starting a post-8 p.m. ban in September.
Under government plans, all commercials will be nixed by January 2012.
The proposed tax has already come under fire from French private nets, as well as the European Commission.
At a meeting with culture minister Christine Albanel on Tuesday, the CEOs of terrestrial webs TF1, M6 and paybox Canal Plus expressed their concern that the figures on which the government was basing France Televisions’ ad revenue losses were over-valued.
Also Tuesday, a spokesman for the European Commission’s information, society and media commissioner, Martin Selmayr, said that “for the European Commission … a further tax on a sector that drives growth isn’t desirable.”
He also said the proposed taxes would be analyzed for their compatibility with EU regulations.
Cope said on Tuesday that he hoped the new law on pubcasting would be passed before the end of the year.