Seized by French companies, it had retoqué tax only on dividends received from a subsidiary established in European Union. But or types of dividends, including those from subsidiaries established in France or in states outside European Union, were still subject to m.
The Constitutional Council, for its part, considered that this difference of situation ignored "Principles of equality before law and public charges" and was "contrary to Constitution".
According to PLF 2018, abolition of this additional contribution to corporate tax (IS) represents a shortfall of EUR 1.8 billion in 2018 for state. In addition, in its draft law on public finances for years 2018 to 2022, Government considered that State could have to reimburse 300 million euros in 2018, n 1.8 billion each year in 2019, 2020 and 2021, to companies that Have had to pay this tax in recent years, at a total cost of EUR 5.7 billion.
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Asked by Agence France-Presse, Bercy said that a "discussion period" would open with companies to find a solution. In August, Ministry of Economy and Finance had pointed out that government was considering a temporary tax measure on large companies to compensate for disappearance of this tax. But no such provision was included in PLF 2018.
The French Association of private enterprises (AFEP), which actively challenged this tax, "took note of decision" in a communiqué and noted "with satisfaction" that PLF provided for deletion of this contribution. "It was extremely unfavourable to location of seats on our territory and to investment in French companies," said AFEP.
In absence of a difference in circumstances, only a general interest motive could have justified difference in disputed treatment. However, by instituting contribution in question, legislator has pursued a goal of budgetary performance, sages of Palais-Royal have pointed out in ir decision.
Indeed, this contribution had been put in place in 2012 shortly after arrival of François Holland to presidency, to compensate for a loss of budgetary revenue and to encourage companies to reinvest ir profits.