French Finance Bill for 2026 – Law adopted on 2 February 2026

Key Tax Measures Affecting Businesses

The French Finance Bill for 2026 (Projet de loi de finances – PLF 2026) was definitively adopted on 2 February 2026. Initially tabled before the French National Assembly on 14 October 2025, the bill was the subject of extensive parliamentary debates, marked by several uses of Article 49.3 of the French Constitution, leading to its adoption on a new reading by the National Assembly on 30 January 2026, and subsequently to its final adoption on 2 February 2026 following the rejection of two motions of censure.

Compared with the draft bill presented in autumn 2025, the final text is significantly more streamlined. Several measures initially announced were not retained, while a number of technical provisions with a high operational impact for businesses were confirmed.

I. VAT MEASURES

1. Tax on imports of low-value consignments

PLF 2026 introduces a flat-rate tax on the importation of goods contained in consignments with an intrinsic value of €150 or less.

The adopted text expressly sets out the amount, the effective date and the temporary nature of the measure.

The tax on imports of low-value consignments is set at €2 per consignment. A reduced rate of €1 per consignment applies where the importation is declared under a simplified declarative regime allowing automated processing of data by the tax authorities. Failing this, the standard €2 rate applies by default.

The tax is payable by the VAT liable person upon importation.

The tax applies as from 1 March 2026. It will be repealed upon the entry into force of an equivalent European mechanism and, in any event, no later than 31 December 2026.

2. Electronic invoicing and e-reporting: strengthened obligations and penalty regime

The adopted PLF 2026 strengthens and secures the legal framework governing electronic invoicing and the transmission of transaction data to the French tax authorities. It clarifies operational mechanisms and the applicable penalty regime, thereby reinforcing the compliance challenge for businesses.

Obligations

Mandatory use of an approved platform:

• for the receipt of electronic invoices;
• for the transmission of electronic invoicing data to the tax authorities;
• for the transmission of e-reporting data (B2C transactions, cross-border transactions, etc.).

A central directory is established: approved platforms feed a directory enabling the proper routing of invoices.

Penalties

Failure to use an approved platform for invoice receipt:

• €500 three months after formal notice;
• €1,000 six months after formal notice, then renewable every three months.

Failure to transmit data:

• €500 per transmission, capped at €15,000 per year for the taxable person;
• €750 per transmission, capped at €100,000 per year for the platform.

The entry into force of these measures remains aligned with the electronic invoicing rollout timetable set out in prior legislation, depending on the size of the companies concerned.

3. VAT refund scheme for tourists: enhanced security and new requirements

The provisions relating to the VAT refund scheme for tourists mainly concern operators managing refund platforms and terminals, as well as retailers using such operators.

The text strengthens compliance requirements and, where applicable, introduces the obligation to provide a financial guarantee covering at least one quarter of the commitments of the applicant operator.

The new requirements relate in particular to:

• the financial guarantee;
• data transmission via a platform interfaced with the tax authorities;
• evidence of the effective exportation of the goods;
• updating of declared information.

These provisions largely enter into force on 1 March 2026 and introduce new operational constraints, particularly in terms of guarantees.

II. CORPORATE INCOME TAX AND WEALTH-RELATED TAXATION

4. Introduction of a tax on certain assets held by wealth-holding companies

PLF 2026 introduces a 20% tax on the holding of assets not allocated to an operational activity by certain wealth-focused holding companies.

Conditions of application (cumulative)

• Fair market value of the assets ≥ €5 million at the end of the financial year;
• Company controlled, directly or indirectly, by one or more individuals holding more than 50%;
• Passive income representing more than 50% of total income (dividends, interest, rents, royalties, etc.).

Tax base

The tax is assessed on the fair market value of certain non-operational assets, in particular:

• luxury or personal-use assets (passenger vehicles not used for business purposes, yachts, aircraft, etc.);
• real estate assets whose use is reserved for individuals;
• other assets expressly listed in the legislation.

The companies concerned will be required to declare and pay this tax for financial years ending on or after 31 December 2026, under procedures aligned with corporate income tax rules, together with specific reporting obligations.

III. LOCAL TAXATION

5. Targeted adjustments

CFE (local business property contribution): the Finance Act for 2026 amends Article 1478 of the French Tax Code by removing certain neutralisation rules applicable in the event of a change in situation or activity. This change results in a more immediate reflection of operational changes in the CFE tax base, reducing opportunities for temporal deferral or mitigation of taxation.

Tax on commercial brownfield sites: the Finance Act for 2026 allows local authorities to introduce the tax on commercial brownfield sites in a targeted manner, within specific areas covered by territorial revitalisation schemes. This development increases the tax exposure of vacant commercial assets and strengthens economic pressure to bring them back onto the market or to proceed with asset reallocation.

Both measures are scheduled to enter into force on 1 January 2026.

IV. TAX MEASURES NOT RETAINED

The measures below were included in earlier proposals but do not appear in the adopted text.

VAT small business exemption scheme: no change has been made to the thresholds set out in Article 293 B of the French Tax Code. The VAT exemption thresholds therefore remain at €37,500 (or €41,250 under the tolerance threshold) for supplies of services, and €85,000 (or €93,500 under the tolerance threshold) for supplies of goods, with specific thresholds applicable to certain professions (including lawyers).

CVAE (value-added contribution on business activity): the regime applicable in 2026 remains unchanged and continues to apply under the rules and rates in force in 2025. Earlier legislation provides for a gradual phase-out of the CVAE by 2030, subject to future finance acts.

C3S (social contribution on corporate turnover): the scheme remains in force, following its accidental repeal during parliamentary debates and its immediate reinstatement.

Other tax measures initially proposed, as well as numerous subsequent amendments, were not retained in the final version of PLF 2026. The adopted text must now be reviewed by the French Constitutional Council prior to promulgation and publication in the Official Journal of the French Republic.