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29 July 2005
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Exemption for management of certain mutual funds
With effect from 1 July 2005, management of a SICAV became VAT exempt, with an option to tax. It also became possible to cancel such an option in certain circumstances.
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10 June 2005
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More books qualify for reduced VAT rate
On 12th May 2005 the VAT definition of “books” was broadened to include items such as photographic books, atlases, guides, directories, artistic catalogues, geographic charts, colouring books, children’s books, exercise books. Such publications now qualify as “books” for VAT purposes and benefit from the reduced rate of VAT of 5.5%.
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VAT treatment of forfeited room fees
A French court has referred a case to the European Court of Justice concerning the VAT liability of advance fees paid to reserve an hotel room which are retained by the hotel if the booking is cancelled. The taxpayer is claiming that the fees should be free of VAT as representing contractual damages.
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19 November 2004
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Social VAT to ease cost of labour
France is considering the introduction of a "social VAT" that would ease the cost of labour for employers by shifting some of the financial burden of their contributions on to VAT. The advantage being that it would be levied on import products as well, whereas currently the cost of labour is reflected only in French products .
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19 March 2004
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Reduce VAT on CDs?
France is seeking permission from the European Commission to reduce VAT on audio CDs from 19.6% to 5.5%. In a document given to the EU Council of Finance Ministers it argues that the measure will sustain demand and have little effect on the budget.
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6 February 2004
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Reduced Rate on Restaurant Meals
The French Prime Minister, Jean-Pierre Raffarin, has said that he is 'deeply disappointed' by the German opposition to the proposal to reduce restaurant VAT to 5.5%. He vowed to continue his campaign for the VAT cut. A change to the list of supplies that are subject to a reduced rate needs to be approved by all EU countries.
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30 January 2004
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Proceedings over double tax on imported second hand cars
The European Commission has requested that France end its practice of imposing double taxation on second-hand vehicles imported from other Member States. France now has two months to rectify its practice.
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23 January 2004
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Conditions of 13th Directive VAT reclaims relaxed
France has recently modified the conditions under which VAT incurred in France by non-EU VAT registered companies is reimbursed. The reimbursement procedure is now similar to that available to EU VAT registered companies under the 8th EC Directive. In particular the condition requiring expenses to be incurred with a view to the commercialisation of products in France is abolished and the condition of reciprocity is deemed to be satisfied unless the applicant is established in a listed country or territory (at the moment the list is empty). These changes apply to VAT incurred in France from 1 January 2004 onwards. Applications for reimbursement of French VAT incurred in 2003, for which the deadline is 30 June 2004 at the latest, must be made under the previous rules.
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19 September 2003
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Electronically supplied services and broadcasting
The French tax authorities have recently issued a statement of practice pursuant to the introduction of the EC Directive concerning VAT on radio and television broadcasting and certain other electronically supplied services. It lays out the scope and effect of the new territorial rules, defines the scope of the services which will be affected, and details the special regime for non-European Union operators supplying to EU residents who are not VAT registered.
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5 September 2003
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Guidance on Invoicing Directive issued
The French tax authorities have recently issued guidance relating to the introduction of the Invoicing Directive into French law. These guidelines are applicable to invoices issued from 1st July 2003 onwards, but businesses may continue to issue invoices under the previous rules until 31st December 2003.
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1 August 2003
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Invoicing Directive
The French tax authorities have decided that businesses will not be required to include the customer's VAT number on invoices for domestic transactions. This has been confirmed in the public notice issued on 7 August.
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1 August 2003
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VAT rate to be cut on food
The VAT rate on restaurant meals will be cut from 19.6% to 5.5% next year. This is following claims that the tax cut is needed to slow the downturn in business. However, reports suggest that prices for consumers are likely to stay the same, as the extra takings will be used by restaurant businesses to increase staff numbers or reduce debts.
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23 May 2003
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Tonnage-based flat-rate tax regime approved
The European Commission (EC) has approved the adoption by France of a tonnage-based flat-rate tax regime for maritime transport. The tax regime will be introduced from 2003 to 20004 in an attempt to boost the French Fleet's competitive position. France is the tenth EU member state to introduce a regime of this kind, behind Greece, the Netherlands, Denmark, the UK, Germany, Spain, Finland, Ireland and Belgium.
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16 May 2003
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Pressure to reduce music VAT rate
France is expected to put pressure on the rest of the European Union finance ministers during a meeting in Brussels in June, to reduce the VAT rate on recorded music.
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7 February 2003
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Reduced rate on dwellings extended
The 5.5% VAT rate for work on dwellings (and some services provided to individuals) has been extended until 31 December 2003.
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24 January 2003
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EU infringement procedure over input tax recovery
The EU has launched infringement proceedings against France for restricting the input tax recovery of taxpayers receiving grants.
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