Tax in France: VAT, income tax, company tax, capital gains

TVA in France

EU value-added system with several reduced rates; net TVA = collected − deductible.

Standard rate

20%

Local name

TVA — Value Added Tax

Type

VAT

Reduced rates

10%, 5.5%, 2.1%

Registration threshold

EUR ~85,800 goods / 37,500 services

Filing

Monthly or quarterly

Authority

Direction Générale des Finances Publiques

Current rate since

1 January 2000

Company tax in France

The headline corporate income tax rate is 25%. In effect since 1 January 2026.

Indicative only: confirm with France's national tax authority. OECD 2026: central statutory CIT 36.13%, combined (central+sub-central) 36.13%; central rate excluding surtax 25%; small-business combined 15% Reduced rate 15%, not modelled as a small-company rate: OECD 'targeted at small business' central rate; qualifying conditions not stated in OECD data.

France company tax calculator →

Did you know? France tax facts

• VAT itself was invented in France in 1954 by a single tax official, Maurice Laure, who trained as an engineer at the Ecole Polytechnique before becoming a tax inspector.

  Laure designed the taxe sur la valeur ajoutee to replace the inefficient cascade taxes; the model has since spread to more than 150 countries, with the United States the only major (OECD) holdout.

  Source: Connexion France ↗

• France once charged a luxury VAT of roughly 33% (the 'taux majore') on cars, perfume, jewellery, furs, cameras and caviar.

  This higher rate ran at 33% from 1970 to 1982, was later cut to 28% (1988) then 22% (1990), and was abolished entirely in 1992; today luxury goods just pay the standard 20% rate.

  Source: Wikipedia (FR) - Taxe sur la valeur ajoutee en France ↗

• In 2024 France's highest court ruled that fresh supermarket sushi is taxed at 10%, not the 5.5% food rate, because it counts as food 'for immediate consumption.'

  In the 'Sushi Saint-Cloud' decision (Conseil d'Etat, 18 June 2024, no. 476093) the court held that sushi is by its very nature meant to be eaten now, so packaging or place of purchase make no difference to the rate; the tax administration adopted this from 1 October 2024.

  Source: BOFiP (French tax administration) - jurisprudence sushis frais ↗

• France has a 'super-reduced' VAT rate of just 2.1% - one of the lowest legal rates in the EU.

  It applies to medicines reimbursable by social security, the daily and periodical press (explicitly excluding pornographic publications), the TV licence fee, and the first 140 performances of a newly created theatrical or musical work.

  Source: Wikipedia (FR) - Taxe sur la valeur ajoutee en France ↗

• The same tub of caviar or margarine can be taxed at 10% or 20% depending only on whether you might eat it on the spot.

  Caviar, margarine and vegetable fats are taxed at the full 20% rate when sold in packaging that lets you keep them, but drop to the 10% intermediate rate when sold for immediate consumption (e.g. in catering).

  Source: Service-Public Entreprendre - VAT rates on food and beverages ↗

• France created its income tax by the finance law of 15 July 1914 and first levied it in 1916, mid-way through the First World War; even today close to half of French tax households pay none at all.

  French Wikipedia: the tax was 'créé par la loi de finances du 15 juillet 1914 et mis en place en 1916'; 'près de la moitié des foyers français n'est pas imposable' — 43.7% of tax households were taxable in 2017.

  Source: Wikipédia (FR) — Impôt sur le revenu (France) · checked 10 October 2026 ↗

• France only moved to pay-as-you-earn on 1 January 2019; until then income tax was paid the year after it was earned — and employers are told only the rate to withhold, never the household's income.

  French Wikipedia: 'depuis le 1er janvier 2019, l'impôt est prélevé à la source pour la plupart des contribuables'; the English article adds that the administration gives employers only the individual tax rate to apply, protecting employees' privacy, and lists the per-'part' rates 0%, 11%, 30%, 41% and 45%.

  Source: Wikipédia (FR) — Impôt sur le revenu (France) · checked 10 October 2026 ↗

• French income tax is computed per 'part', not per person: the quotient familial, created in 1945, counts one part for a single adult, two for a couple, half a part for each of the first two children and one each after.

  Wikipedia: 'The family quotient is one unit for a single person, two for a married couple', plus half a unit for each of the first two children and one unit for each later child; household income is divided by the parts before the progressive scale is applied.

  Source: Wikipedia — Taxation in France · checked 10 October 2026 ↗

• France's wealth tax, the ISF, was abolished in September 2017 and replaced from 2018 by the IFI, which taxes only real-estate wealth — above a €1.3 million threshold that has stood since 2011.

  Wikipedia: the earlier IGF was 'abolished in 1986 by Jacques Chirac's right-wing government' and the tax 'reestablished in 1988 as ISF'; the threshold has been €1.3 million 'since 2011'; the government abolished the ISF in September 2017 and replaced it with the real estate wealth tax (IFI) from 2018.

  Source: Wikipedia — Solidarity tax on wealth · checked 10 October 2026 ↗

More stories, for every country that has one, on the tax facts page.