Draft Finance Bill would remove the reduced TV rate and tighten VAT valuation rules for employee company cars
France’s draft Finance Bill for 2027 includes several VAT changes, including the withdrawal of a reduced rate and new rules for company vehicles:
- proposed abolition of the 10% reduced VAT rate for television services. These services would instead become subject to the standard 20% VAT rate from 1 January 2027.
- the VAT treatment of company vehicles provided to employees and directors. French guidance currently allows a vehicle supplied in return for a payment or salary deduction to be treated as a taxable service, potentially allowing the employer to recover associated input VAT. From 1 January 2027, the taxable amount for such supplies could not be lower than the vehicle’s market value. This would prevent businesses using a relatively small employee contribution as the VAT taxable amount while recovering VAT on acquisition, leasing or maintenance costs.
- It would also extend certain invoicing exemptions for transactions subject to a zero VAT rate.
- Several adjustments alongside France’s recodification of VAT legislation into the Code des impositions sur les biens et services (CIBS), due to take effect on 1 January 2027.
- allowing to opt to tax leases of undeveloped land, restoring VAT options for certain property leases conferring real rights, and reinstating special VAT timing rules for supplies of buildings under construction, including off-plan property sales.
The measures remain proposals and may change during the parliamentary passage of the 2027 Finance Bill.
The French Government has confirmed that the PLF 2027 was submitted to the National Assembly on 1 October 2026 and remains subject to parliamentary amendment.
See our French VAT guide for more details
