The 2026 draft Finance Bill raises VAT exemption thresholds to EUR 41,250 (standard) and EUR 27,500 (real estate and construction).
France’s parliament has introduced changes to VAT registration thresholds in the draft Finance Bill for 2026, which was submitted on 14 October 2025.
As per the 2026 draft Finance Bill, businesses will face updated turnover thresholds for VAT exemption. The standard threshold for the prior year is set at EUR 37,500, while a lower threshold of EUR 25,000 applies to real estate and construction work. For the current year, these thresholds increase slightly to EUR 41,250 and EUR 27,500, respectively.
This marks a shift from the Finance Law for 2025, which had initially proposed a single threshold of EUR 25,000. Implementation was postponed to allow for further deliberation, with the adjustments now incorporated into the 2026 Finance Law.
Earlier, the 2026 draft Finance Bill included several tax-related updates impacting large corporations and businesses. A temporary surtax on corporate income tax for companies with annual revenues of at least EUR 1 billion will be extended for another year. However, starting in 2026, the surtax rates will be halved. Companies earning between EUR 1 billion and EUR 3 billion will see their rate drop from 20.6% to 10.3%, while those with revenues exceeding EUR 3 billion will face a reduced rate of 20.6%, down from 41.2%.
Additionally, the elimination of the CVAE business tax will be accelerated. The top effective rate will decrease to 0.19% in 2026, two years earlier than planned, and further drop to 0.09% in 2027, with the tax being abolished by 2028.
Lastly, the global minimum tax rules under Pillar 2 will be updated to align with the OECD’s administrative guidance issued in June 2024.
The tax measures are set to take effect from 1 January 2026, upon approval.
