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Dividend tax: The state will have to reimburse up to EUR 10 billion to companies

Bercy had provisioned EUR 5.7 billion over five years to repay the companies that had paid the tax, which had been invalidated by the Constitutional Council.

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Dividend tax: The state will have to reimburse up to EUR 10 billion to companies
The bill will be higher than expected. After invalidation by Constitutional Council of 3% tax on dividends introduced in 2012, state will have to reimburse 10 billion euros to large companies. This was announced by government spokesman, Christophe Castaner, on Wednesday, 18 October.

"The legal amateurism has led to make biggest tax gift ever made to companies of this country," blasted Mr. Castaner, attacking – without naming it – government of Jean-Marc Ayrault (PS), who had introduced this tax. The government spokesman announced that " range [was] between 8 and 10 billion, maximum risk is 10 billion".

A first part of this measure had been invalidated by Court of Justice of European Union in May and n totally retoquée by Constitutional Council on 6 October. For Bercy, who had taken lead by removing this tax from bill of finance 2018 even before opinion of Constitutional Council, cost of cancellation is a headache.

READ ALSO: The Constitutional Council totally invalidates 3% tax on dividends

EUR 5.7 billion provisioned

This deletion represents a shortfall of 1.8 billion euros in 2018 for state. In its bill of public finances for years 2018 to 2022, government had estimated 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 had to To pay this tax in recent years, a total cost of EUR 5.7 billion.

The Minister of Economy, Bruno le Maire, "works on reimbursement modalities, it may find its place in law of amending finance," continued Mr. Castaner, according to whom no provision had been made on this dossier in budgets 2016 and 2017.

"Those who give lessons are responsible for a state debt equal to four or five years of ISF." At minima, modesty in face of this kind of situation should be imposed, he added; An allusion to recent criticisms of François Hollande against reduction of ISF decided by government.

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