France plans to cut corporation tax to 25% by 2022
French prime minister Edouard Philippe has confirmed plans to cut corporation tax from 33% to 25% over the next five years, but suggested that the timetable for other tax cuts may be delayed in his opening speech to the country’s National Assembly
6 Jul 2017
Phillip indicated that the government intends to make France more attractive to business, stating: ‘Businesses must want to set up and develop on our territory rather than elsewhere.’ He announced that corporation tax would be reduced to 25% by 2022.
However, French president Emmanuel Macron's pre-election pledges outlined a total of €20bn (£17.5bn) of tax cuts, including reducing taxes on property and wealth. The prime minister indicated that these might have to wait until public finances have improved.
In his speech, Philippe highlighted what he termed France’s ‘intolerable reliance on state borrowing’, saying: ‘We are dancing on a volcano that is rumbling ever louder’
‘The French are hooked on public spending. Like all addictions, it doesn’t solve any of the problems it is meant to ease. And like all addictions, it takes will and courage to detox.’
Philippe said public debt totalled €2.1trillion, nearly the equivalent of a year’s economic output, and said the government’s aim was to bring France’s deficit within the EU limit of 3% of GDP this year.