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Partial taxation of costs and expenses
The freedom of establishment prohibited by Article 49 of the Treaty on the Functioning of the European Union (TFEU) is being considered by the Administrative Court of Appeal of Versailles. Taxand France provides an overview.
Macron Law deals with a range of areas including regulated professions, coach transportation, working on Sundays and the Labour Court System.
It is recalled that Article 223 B of the French tax code provides for the neutralisation of the add-back of the proportion of costs and expenses related to the dividends received by a French parent company from a French subsidiary when both companies are members of the same consolidated tax group.
The result is a difference of treatment depending on whether the dividends are received from a French subsidiary member of the same consolidated tax group as the parent company or, from a subsidiary established in another Member State which could have been part of this consolidated tax group if it had been established in France.
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It is appropriate to consider all the benefits of the French tax consolidation regime with regard to the principle of freedom of establishment (including the exemption from the 3% corporation surtax on dividends which benefits to intra-group dividends).