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Pending French pay-TV VAT hike widely condemned
Pascale Paoli-Lebailly ©RapidTVNews | 03-09-2010
The plan of French Minister of Budget François Baroin to increase the VAT payable on pay-TV services to 19.6 %, has, not surprisingly, attracted the ire of France’s service operators.
The whole French TV sector is worried about the scheme. The CEOs of all the pay-TV groups concerned—such as Martin Bouygues, Marc Lombardini of Iliad/Free and Jean-Bernard Levy of Vivendi— have criticised the idea, pointing out that it lacks coherence and is fundamentally bad for consumers.
At present, half of the subscription revenues of Canal+, CanalSat, Numericable and the suppliers of triple play offers are currently taxed at 5.5 %. The new tax plan would likely bring around €1 billion to the French state who is defending the move by saying that France is acting according to a request by the EC to review its tax regime.
The French association of digital and theme channels A.C.C.e.S. also condemned the move saying: “it would lead to a loss of subscribers. And if operators do not raise their prices they will undoubtedly decrease the licence fee they give back to channels.” For its part the French association of TV authors described the proposed move as destructive, adding that it would lead to a reduction of investment by operators and TV services into TV, reducing cinema production and weakening the whole French TV landscape.
