The new Law No. 2019-759 has been published on July 25, 2019, in the Official Gazette, which introduces Digital Services Tax (DST). It was signed by the French President, Emmanuel Macron, on July 24, 2019. This new Law also modifies the downward trajectory of corporation income tax (CIT).
In accordance with Law No. 2019-759, a 3% DST will be applicable for large companies whose respective groups have revenue of at least EUR 750 million worldwide and EUR 25 million in France from certain covered digital activities, including digital advertising and facilitating digital market place platforms. The tax would be applicable to taxable revenues collected as of January 2019 with a first installment due in October 2019 on the basis of 2018 revenues.
This Law also modifies corporate income tax (CIT) rate for large companies. Companies with a turnover of 250 million or more is subject to 33.33% rate (instead of 31% rate deriving from Finance Bill for 2018) for financial year starts from January 1, 2019 to December 31, 2019 on the amount of profits more than EUR 500,000. But, 31% rate remains unchanged for companies not exceeds that above threshold. The standard corporate income tax rate will be further reduced to 28% in 2020, 26.5% in 2021 and to 25% in 2022 for all companies.
