France threatens Google with tax

France has told Google it if it doesn’t pay news publishers in the country for taking excerpts from its newspapers in search results, it will charge the Internet giant and other search engines a tax, as Germany has previously done, paidContent reported today.

Google Executive Chairman Eric Schmidt met with French President François Hollande yesterday to discuss the matter.

“(Hollande) stressed that dialogue and negotiation between partners seemed, to him, the best way – but, if necessary, a law could intervene on this issue, as with the current project in Germany. The development of the digital economy calls for an adaptation in taxation in order to better understand the value of sharing and funding the creation of content,” a statement released by the Elysee presidential palace said, according to paidContent.

The proposed law would basically tax the revenue Google earns from ads that show up alongside search results.

But Google isn’t backing down from the so-called pay-to-display law.

“Since Google currently claims to send four billion page impressions per month to French newspapers, which is, by any metric, a large volume of traffic -- so, in response to the threat of the French tax, Google has threatened to simply stop indexing French newspapers altogether,” Wired.co.uk explained.

Saying Google drove traffic away from newspaper sites and refused to pay for content, Brazil’s National Association of Newspapers stopped using Google News earlier this month, Reuters noted.

Image: Medacity.com