5 on half of the invoice and a rate of 19

It is one of the hot topics of the law of finance 2011. Pressed by Brussels to review the taxation of combined offers "triple play" (fixed telephone, Internet, television), the Government does not run next year. The tax system proposed Internet access providers (Free, Numericable, Alice, etc.) is, in fact, very special. They are allowed to practice two VAT rates: a reduced rate of 5.5 on half of the invoice and a rate of 19.6 on the rest. However the European Commission provides a reduced rate of VAT on pay-TV, but not on access to the Internet or the telephone. She feels anomalous to systematically apply the rate reduced on half of the invoice (29.90 euros in many cases), and even that some clients do not use the offer of television.

In April, Brussels therefore required the France that it amends its legislation. Nothing is still refereed, but the Government is tempted to act more quickly. And for good reason: the loss of profits tax to the State becomes considerable. The "triple play" already seduced millions of French, and the "quadruple play", which offers plus a mobile phone, is not the Affairs of the State. Subscribers to mobile telephony are thus increasingly more numerous - about a quarter - to have access to television on their mobile, which virtually did not exist a year ago and a half. While mobile telephone bills were taxed at 19.6, they are therefore more often at the rate of 14 (5.5 for half to 19.6 for the other). Loss of profits that represents hundreds of millions of euros for the State.

Necessarily unpopular

The Government has examined several options: he can impose on operators to present two bills to the consumer, to distinguish clearly the cost of television services, and to isolate the right giving amount at a reduced rate of 5.5. This is technically possible, but complicated. It may also raise VAT at 19.6 on the invoice, and not on the half. But there is then a differential between competing companies tax treatment: Orange TV, for example, would be subject to the rate of 19.6 while Canal , which is not proposed in the offers "triple play", be at the rate of 5.5! This is legally possible, but not necessarily understandable to the eyes of operators and consumers. Even more radical way, the Government has referred the abolition, pure and simple, of VAT reduced on the private channels, which would put everyone, Canal included, at the level of 19.6. The gain for the State would then be close to EUR 1 billion. But far, necessarily unpopular, it also seems to be excluded.

At this stage, a more realistic way is therefore the rope: it would be reduced from 50 to 40, even 30, the share of costs taxed at 5.5. The solution is not ideal, because it is not said that television is actually 30 or 40 of the consumption of the offers "triple play". Brussels may therefore find that the France has not really addressed the problem. A Government has to undertake to reduce the niches fiscal and social of 10 billion euros over two years, the measure may also seem conservative. Nevertheless: it has the merit to be fairly well accepted by the operators. And it will take several months or even years, before Brussels reopens possibly the subject of litigation.

The Elysee Palace has not yet been definitively arbitrated. Beyond the impact for consumers, who could see their bill increase of a few euros, the issue raises many issues. Indeed, the telecoms operators finance cinema production, worth about 100 million euros per year, and see this contribution as a counterparty at the reduced VAT. Legally, the two charges are obviously not related. Nothing precludes the Government harden one without the other. But the lobby of the operators is much focused on this issue, leaving poses the threat of no longer finance the artistic creation.