Why France’s social VAT could make life harder for taxpayers
20 January 2012
Salman Shaheen - ITR
France is pressing ahead with what it is calling a social VAT to reduce labour costs and stimulate jobs, but it could end up producing bigger headaches for companies.
The plans, to be implemented before the presidential election in April, will see France’s 19.6% VAT rate raised to finance cutting employer social security contributions. In this, France is looking to the perceived success of German competitiveness after its neighbour hiked VAT to 19% in 2007 for the same reasons.
“Officially, the French government says that the importations made in France are less taxed then the goods produced in France because the foreign companies do not bear the important social security charges that French established companies have to pay on wages paid in France,” said Gwenaëlle Bernier, an indirect tax partner at Fidal Direction Internationale.
This article is available to subscribers of ITR Premium only. Please login to read the rest of this article.
If you would like to gain access to related content from our other products, please upgrade your current subscription.
Subscribe now
This article is available to subscribers only. To gain acess to to the rest of this article please subscribe to ITR Premium.
Subscribe