WASHINGTON: Alphabet Inc’s Google unit, Facebook Inc and Amazon.com Inc are among the companies that will testify Monday at a US government hearing on the French government’s digital services tax, media reports said.

In July, the French Senate approved a 3% levy that will apply to revenue from digital services earned in France by companies with more than 25 million euros in French revenue and 750 million euros ($838 million) worldwide.

The US Trade Representative’s Office in July opened a probe into the new tax it called “unreasonable.” The office could issue new tariffs on French goods or other trade restrictions after the public comment period closes on August 26.

Amazon’s international tax policy director Peter Hiltz said in written testimony for the USTR hearing that more than 10,000 French-based small- and medium-size businesses are selling on Amazon’s online stores and notified them that certain fees will increase by 3% for sales made on Amazon.fr from October 1.

Facebook global tax policy head Alan Lee’s testimony said the tax “poses difficulties for Facebook’s business model and will hinder growth and innovation in the digital economy” and would require a re-engineering of its systems.

(Agencies)