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France: Temporary “exceptional surcharges” for large corporate taxpayers finally adopted

France: Temporary “exceptional surcharges” adopted

The French Constitutional Court (Conseil Constitutionnel) held that “exceptional surcharges” to the French corporate income tax—to be imposed on the largest companies—are constitutional, thus finalizing implementation of the tax levy.


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Exceptional surcharges

The exceptional surcharges apply to French companies or branches subject to corporate tax, and having gross revenue exceeding €1 billion. For French corporate tax groups, the €1 billion threshold will be applied at the level of the French tax group.  

  • The surcharges will be imposed on the amount of corporate income tax due on the results of financial years closed between 31 December 2017 and 30 December 2018.
  • The “exceptional contribution” will equal 15% of the gross amount of corporate tax owed by the taxpayer, before being offset by any tax credit or tax reductions (an adjustment will be made for companies with revenues between €1 billion and €1.1 billion to minimize the rate of the surcharge due by entities having just exceeded the threshold). 
  • Taxpayers with revenue (as defined above) exceeding €3 billion (subject to an adjustment for companies with revenues between €3 billion and €3.1 billion to minimize the rate of the surcharge) will be subject to an “additional contribution” equal to 15% of their corporate tax liability, again before taking into consideration any offsets of tax credits or tax reductions. In other words, these taxpayers will be subject to a total surcharge of 30% of their gross corporate tax liability.

Read more about the surcharges as proposed in TaxNewsFlash-Europe

As regards French branches of foreign companies, and contrary to what had been expected, the revenue thresholds (described above) for both the exceptional and the additional contributions will apply at the French-level only. In other words, a French branch with French revenue below the threshold amounts will not be subject to the surcharges, even if the global revenue of the concerned foreign company exceeds the thresholds.

Conversely, a French company with foreign branches will be subject to the surcharge levies only if its French revenue (excluding that of its foreign branches) exceeds the application thresholds.

Paying the surcharge in December 2017

A provisional payment equal to 95% of the expected surcharge must be made at the date of payment of the last corporate tax installment, at the latest on December 20 for companies closing their financial years between December 31, 2017, and February 19, 2018.


For more information, contact a tax professional with Fidal* in France or with KPMG in the United States:

Gilles Galinier-Warrain | +33 1 55 68 16 54 | 

Patrick Seroin | +1 (212) 954-2523 |

* Fidal is a French law firm that is independent from KPMG and its member firms.

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