International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2023

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Francois Hollande's government brings transfer pricing amendments to France

Francois Hollande's just-elected French government has proposed new measures to increase tax revenues, including changes to the transfer pricing regime.


As new President Francois Hollande has a majority in parliament, the likelihood of the measures being passed is high and illustrates the government’s desire to strengthen the French Tax Administration’s authority on tax avoidance.

The changes target abusive corporate income tax strategies and state that the burden is on French companies, rather than the authorities, to demonstrate that any subsidiaries in tax havens have real substance and do not merely exist to avoid tax..

Companies can no longer deduct payments to subsidiaries, particularly those overseas, from their taxable profits if the objective of the subsidy is only financial (in that it is only for tax purposes).

Taxpayers that reduce their operations in France through cuts in production, closing sites, reducing profits or reducing assets cannot carry forward tax losses.

Any company that is part of a merger or takeover will no longer be allowed to transfer losses to other companies in the group unless the same level of production and employment is maintained.

more across site & bottom lb ros

More from across our site

Interview with Hadeel Biyari, partner, Deloitte and Touche & Co. – Chartered Accountants
The winners of the ITR Europe, Middle East, and Africa Tax Awards 2023 have been announced!
The winners of the ITR Asia-Pacific Tax Awards 2023 have been announced!
Mauro Faggion appeared cautiously optimistic as the European Commission waits to see whether all 27 member states will accept its proposal.
The global minimum rate also won’t entirely stop a race to the bottom, according to a tax director speaking at an ITR conference in London.
The country’s tax authorities are not interested in seeing transfer pricing studies any more, it was claimed at an ITR industry conference in London.
The controversial measure is being watered down after criticism from the European Central Bank.
More than 600 such requests were made in 2022, while HMRC has also bolstered its fraud service, it has been revealed.
The General Court reverses its position taken four years ago, while the UN discusses tax policy in New York.
Discussion on amount B under the first part of the OECD's two-pronged approach to international tax reform is far from over, if the latest consultation is anything go by.