What is the google tax?

Spanish Law Sat, 8 Nov 2014
google taxes

The word ‘google’ is part of our day-to-day vocabulary. In the Oxford dictionary paperback version it is defined as ‘search for information about someone or something on the Internet, especially with the Google search engine.’

The last part of that definition is perhaps particularly interesting. There are other search engines apart from Google such as Bing and Yahoo. But such is Google’s accepted status now that it has cornered the name for the whole market. It’s also commandeered maps, translation services, and alerts.

So ingrained in our internet habits is Google that we may not even think of it as a corporate body any more. Yet, this is a company (Google Incorporated) with shareholders and assets and as such it is also liable for tax. And this is where Spain comes in.

Taxing google

You might have heard that the Spanish Parliament has passed a law allowing news publishers to charge tax to Google. This is part of a new intellectual property law that means news publishers can charge for each time that news content is displayed in search results.

The law will be implemented from January 1st 2015 but as yet there is no decision on how much will be charged for the privilege. Although it is being called the Google Tax it does in fact apply to any blog or website that posts a section of or links to copyrighted material. It will mean that services posting links will need to pay a fee to the Spanish newspaper organisation the Association of Editors of Spanish Dailies (AEDE).

Why?

In the same way as our methods of finding out information have changed so has the stability of the publishers and journalists who source the information in the first place. Sales of paper copies of magazines and newspapers have plummeted and publishers are still trying to find the best way of balancing between open content and paid subscription.

We might love getting so much news for free but this doesn’t pay the mortgage for those employed to write about it. If we no longer have professional journalists and authors then we are left to the whim of the volunteers and would-be hacks.

Some might feel that they couldn’t do a worse job than some of those employed to write professionally. However, the fact remains that we are at risk of losing any attempt at impartiality or responsible news reporting if some way of protecting creative content isn’t found.

It is the service ‘Google News’ which is particularly criticised for using copyrighted material to build up their own service without employing any journalists or doing any reporting themselves.

Google are conscious of the concerns and, for example, they have now agreed to help French news organisations to increase their online advertising revenue. Google has now promised to assist publishers in Spain to increase their income too.

Rather than being a drain on creative content, Google argue that the Google News service brings traffic to publishers’ websites.

What are the implications of the new law?

It is hard to see at this stage exactly what the impact will be. In Germany where a similar law was applied it led to Google removing the affected newspapers from Google news. These particular newspapers saw their traffic drop substantially because of the power that Google has.

It could certainly lead to websites being much more ‘jumpy’ about what they publish. However, there is opportunity to remove the link first if it is asked for. Where a website doesn’t comply, links might be automatically removed if the copyright holder demands it. The threat has been made that guilty sites might be fined up to €600,000 if they don’t comply.

There is plenty of confusion out there and rumours that it could lead to some sites boycotting Spain completely, ‘just in case’. The wording of the new law is vague and is likely to need some testing out before we can be sure exactly what its implications will be. For example it allows for the publication of ‘non-significant fragments’ which begs the question what are ‘significant fragments’?

The difficulty of protecting copyright in these days of maximum accessibility is one of the chief worries for the creative industry. The world will be watching to see if Spain’s new laws are a blueprint for the future or a hark back to the past.  

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