Mr. Alain Lamassoure:

The idea, which the Deputy has correctly understood, is to take the digital data collected and exploited for commercial use as the fourth factor. There is a problem that is open to discussion, negotiation and amendment. By the way, this will be another issue that could be appropriately raised by the Irish representative on the working group of the Council if Ireland believes the weighting of the different factors is not in its interests and it would prefer another weighting. Deputy Paul Murphy would recommend a stronger weighting for labour. My recommendation to our committee, which has not yet voted, is to have an equal weighting for the four factors. This is usual practice in the OECD and also simpler. However, some members or groups insisted on basing the formula on sales or a combination of sales and labour without capital. If we attach too much importance to labour, for instance, the risk is that this would be to the detriment of those who invest more in new technologies, robotisation, etc., which is progress. Conversely, if we base too much on capital, it would detrimentally affect enterprises with a large workforce. We are open on this matter.

On the digital factor, the first problem is to find a definition which enables us to link the digital economy to a geographical base or jurisdiction. Having listened to many tax and engineering experts specialising in the digital economy, we arrived at the idea that, by definition, everything is movable in the digital economy, apart from personal digital data. To take Facebook as an example, the company has 30 million users in France, of which I am one. Incidentally, Facebook does not pay any tax in France, which is unacceptable. Facebook can collect and exploit data from France everywhere in the world or even in the cloud but it cannot prevent my personal data from being based in France or, in my case, the 17th arrondissement in Paris. It is easy for the tax administration in France to check this and we proposed a definition. I do not know if it is the best or correct definition and the proposal is open to debate. If we were to take on board this factor, it is open to debate as to whether it should have the same weighting as labour. Given that the European Parliament is entitled only to give an opinion, we cannot make demands. Our political aim, however, is to oblige the Governments to discuss this matter. I hope that will be the case in respect of taxing the digital economy. That is the starting point.