A Bite Out Of Apple

The relationship between French President Francois Hollande’s socialist government and big business will be further strained by his efforts to get more tax out of companies like Apple and Google to help finance French culture.

Hollande’s reportedly asked businessman and former Vivendi-Universal chief exec Pierre Lescure to find ways to protect the arts against a struggling economy.

The country slipped back into recession in the first quarter of the year and Hollande reckons that slapping a 4 percent tax on the sale of smartphones and tablets could help finance music, the arts and filmmaking.

By hitting at Apple’s iPhone and iPod and Google’s Android products he could boost revenues as the country spends more on hardware than content.

“Companies that make these tablets must, in a minor way, be made to contribute part of the revenue from their sales to help creators,” said culture minister Aurelie Filipetti.

The increased taxes would bring Apple and Google in line with TV and radio broadcasters and internet providers, which all contribute part of their earnings to fund French culture.

News of the proposed new tax comes a couple of weeks after industrial renewal minister Arnaud Montebourg blocked Yahoo’s efforts to buy Dailymotion – the country’s equivalent of YouTube – because it wasn’t in France’s “best interests.”

“I won’t let you sell one of France’s best start-ups,” Montebourg’s reported to have told France Telecom’s chief financial officer Gervais Pellissier.

Yahoo had been looking to buy 75 percent of Dailymotion, the world’s 12th-largest video sharing site, which is valued at around euro 228 million ($300 million).

The hitch is the state owns 27 percent of Dailymotion and Montebourg doesn’t want France to part with more than half of the company.