Amazon (AMZN) is fighting back against a recently approved French tax against American tech companies by passing the cost of the tax on to sellers in the country.
In July, France passed a tax on the revenues of Alphabet (GOOGL) , Amazon and Facebook (FB) that is set to go into effect in October, escalating trade tensions with the U.S. The U.S. has argued that the new tax "unfairly targets American companies." Executives from those companies were scheduled to testify at a hearing held by the U.S. Trade Representative on the French digital tax Monday.
Amazon has sent emails to French small business owners telling them that fees for selling on the site will be increasing by 3%, CNBC reported, the same amount of the digital tax on revenues France passed last month.
"This tax is aimed squarely at the marketplace services we provide to businesses, so we had no choice but to pass it down to Selling Partners," Amazon said in a statement. "We recognize that this may place small firms in France at a competitive disadvantage to their counterparts in other countries."
France's digital tax targets companies that make at least 750 million euros ($832 million) globally in annual revenues from "digital activities" and more than 25 million euros ($27.7 million) in France specifically. France estimates the new tax will raise 500 million ($555 million annually).
On Monday, the Office of the U.S. Trade Representative held a public hearing on the Digital Services Tax and made public comments available for viewing here.
In July, U.S. Trade Representative Robert Lighthizer said that it will investigate whether the tax "is discriminatory or unreasonable and burdens or restricts United States commerce."
Amazon shares are rising 1.6% to $1,821.61 in morning trading on Monday.
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