On 15 November 2017, a second draft amending Finance Bill for 2017 was submitted to the French Council of Ministers and was submitted to the French Parliament. The draft law emphasized the following tax measures for the coming year.

Anti-Evasion provision

A new abuse rule would be introduced whereby any merger, spin-off or contribution of assets whose main purpose is tax avoidance and tax fraud would not benefit from the favorable French tax regime. This means that the transaction must have a valid business purpose, such as the Restructuring or rationalization of the activities carried out by the companies involved in the operations.

French favorable merger tax regime

In accordance with the amendment to the financing bill, the requirements that must be met in order to benefit from the favorable tax treatment of France’s merger may vary depending on whether the transaction is aimed at one or more “full business lines”.

Exchange of Information (AEOI) and Foreign Account Tax Compliance Act (FATCA)

The draft Amending Finance Bill includes provisions relating to the obligations of financial institutions in relation to the provisions of the AEOI and FATCA related to the financial statements, in particular as regards the conduct and archiving of client due diligence and the supervision thereof by the French Financial Regulator (in addition to tax authority). The project also mentions new sanctions for financial institutions and clients if some requirements are not met.

Decrease of the interest for late filing or late payment and of the interest on arrears

Taking into account the decrease of interest rates, as well as expenses incurred in paying interest on debts related to tax refunds, the draft Amending Finance Bill envisages reducing the interest rate for tax and customs duties from 0.40% to 0.20% per month (ie , 2.40% year).