After the 'Code Conduct' group on corporate taxation of the Council of the EU, the OECD has taken its turn to examine the French research-related tax credit mechanism (the French 'patent box', a tax scheme favourable to intellectual property, the French daily newspaper Le Monde reported on Friday 20 January).
Readers may recall that in November, the 'Code of Conduct' group officially informed European finance ministers of France's refusal to make changes to its 'patent box' to bring it into line with the overall approach of the OECD (see EUROPE 1664). The 'Code of Conduct' group has been examining this issue since June 2016.
In 2014, the group agreed for modifications to be made to these schemes to comply with the OECD standard ('modified nexus approach'), which aims to link the actual economic activity to the tax advantage. France argues that its tax regime, with a taxation rate of 15%, is frankly unattractive to anybody planning to carry out aggressive tax planning.
According to Le Monde, the OECD experts have reached the same conclusions as the European ones: the French regime is in breach of the new rules to which France has subscribed to. (Original in French by Élodie Lamer)