France plans to reduce the exceptional corporate tax surcharge on its largest companies in the 2027 Budget while keeping the levy in place. Prime Minister Sébastien Lecornu also planned new incentives for employee-led business takeovers and ruled out additional taxes in the Budget.
France plans to lower the exceptional corporate tax surcharge paid by very large companies in 2027, Prime Minister Sébastien Lecornu said in a letter to business executives today, 16 September 2026.
The measure would stop short of abolishing the surcharge, which was introduced in 2025 as a temporary levy and subsequently extended into 2026 under a Budget compromise. Lecornu said the 2027 Budget would not introduce new taxes, with the government seeking to support investment while addressing pressure on public finances.
The government is expected to present its Budget proposal in the coming weeks. It does not hold a majority in the lower house, and several opposition parties have already indicated that they would reject the proposal.
Employee buyout incentives planned
Lecornu also outlined plans for a new tax incentive aimed at encouraging business transfers, particularly acquisitions by employees.
Under the proposed “Papin Pact”, businesses taken over by their employees would receive accelerated depreciation for new equipment required for production. The planned support would provide enhanced treatment for small businesses.
The measure is intended to facilitate business succession, particularly where existing owners do not have family successors or an external buyer. The final design of the incentive will depend on the provisions included in the 2027 Budget.
Review of business support
The government also plans to examine existing state support for businesses. Lecornu said the review would assess whether such measures were delivering their intended objectives in areas including investment, innovation, decarbonisation and production in France.
Support considered ineffective would be subject to review, according to the letter.
The approach comes as the government seeks to reconcile measures aimed at encouraging economic activity with constraints arising from France’s public finances. Corporate taxation remains part of that balance, as changes to temporary levies can affect companies’ longer-term investment and tax planning.
Business groups welcome message
Lecornu said France could not restore its public finances by weakening economic growth and therefore ruled out additional taxes in the 2027 Budget.
The commitment to reduce the exceptional surcharge, rather than remove it altogether, would leave part of the additional corporate tax burden in place while changing its level for 2027.
France’s largest employers’ organisation, Medef, welcomed Lecornu’s message, saying that it was necessary to respond to concerns raised by business leaders.
The precise reduction in the surcharge and the final structure of the employee-buyout measures have yet to be determined. Their impact will therefore depend on the detailed Budget legislation presented by the government.
