Press Room

October 09, 2017

From France: The 3% Contribution on Distribution of Dividends

Denis Fontaine-Besset ​- STCPartners in France, a member firm of Andersen Global


The decision published on October 6, 2017, by the French Constitutional court puts an end to the endless series of episodes about the right for French tax authorities to impose a 3% tax on distributions of dividends by French companies. As a hybrid taxation that was neither a real tax on profits nor a withholding tax on dividends, this contribution finally died from its genuine character. Attacked on various grounds, including before the European court of justice, and applicable to a constantly more limited scope, this contribution was finally killed by the Constitutional court deciding that this contribution was not constitutional. Amazingly enough, the government already intuited this fatal end when proposing in the draft finance bill for 2018, to repeal this contribution as from January 2018. The Constitutional court decision is not only anticipating this proposed modification of the law by a few months but is also a very good news for those many taxpayers who had timely pushed claims before tax courts.