SPECIFICS OF DOING BUSINESS IN FRANCE
France is distinguished by a stable economy, well-developed production facilities, and fairly flexible tax laws. Investments in agricultural and mining enterprises, as well as in trade, tourism, and financial industries, are the most profitable today, according to experts. To succeed, businessmen need to understand the nuances of local legislation and accounting intricacies.
TAXATION
The system of taxation in France may seem complicated, and it has some notable features that differ from other Western European countries. Taxes are collected by the government and local self-government bodies, while social contributions are collected by the appropriate security fund. Notably, social taxes, such as payments and contributions to social funds, are relatively high here. Recently, there has been a growing tendency towards decentralization of tax policy and a decrease in tax rates, accompanied by an expansion of the tax base due to the abolition of certain benefits.
Tax rates in France are progressive, meaning that the amount the taxpayer must transfer to the treasury directly depends on their income level. Laws related to the introduction of new or the abolition of old taxes, as well as the nuances of their application, are approved annually by the parliament of the Republic simultaneously with the adoption of the state budget.
LICENSING
Foreigners planning to do business in France need to keep in mind that investing in defence enterprises, energy and water supply, transport services, telecommunications, and healthcare, requires obtaining permission from the French administration. At the same time, there is no specific term “licence” in the French legal field.
REPORTING
Corporations and legal entities are required to file tax returns by April 30 of the following calendar year or within three months after the end of the year if the financial year does not coincide with the calendar year. There is a penalty of 10% of the total tax bill for non-compliance or late filing of a tax return. It is possible to submit the declaration online. Accounting and calculation of the taxable resources in France, based on the established adjustments, are tightly controlled by the state.
