Under the guise of fiscal consolidation, the Senate Finance Committee is proposing a drastic reduction in tax incentives for innovation, potentially further weakening French competitiveness.
🚨 Les Coups de Rabot Fiscaux
For the time being, the proposal maintains the Research Tax Credit (CIR) despite the criticism and attacks it receives every year in the run-up to the Finance Acts. However, the system is being trimmed a little more each year.
- - Hard blow for research: "Young Doctors" scheme abolished, discouraging recruitment of scientific talent
- - Budgetary restrictions: Exclusion of certain expenses such as technology watch and patent costs, automatically reducing the base eligible for the CIR.
- - Marginalization of Innovation: Reduction in flat-rate operating costs (from 43% to 40%).
💢 A Blow to the Innovative Ecosystem
No sooner born than discouraged! The preferential tax regime set out in article 238 of the French General Tax Code, commonly (and falsely) referred to as the IP Box, has not even had time to pass through the forks of case law, due to a lack of anteriority, before it has already been reformed. The commission is proposing to increase the tax rate on the assets concerned (mainly patents and software) from 10% to 15%, thus returning to its historical rate when the corporate income tax was still 33.33%.
It should be remembered that the reduction in the tax rate for these assets was intended not only to align with the practices of other countries, but also to mark an attractive difference in relation to the standard corporate income tax rate. Wouldn't raising this preferential rate be a prelude to a rise in corporate income tax?
🔍 Critical Analysis
After the government, it's now the Senate's turn to take the tax shift to the detriment of innovation, foreign investment and business stability. Behind the technical cloak lies a purely budgetary rationale that risks undermining France's attractiveness in terms of innovation.
