France: Amending Finance Bill for 2015
Prior to the New Year, the Amending Finance Bill for 2015 was submitted to parliament. Its key focus is to change the current withholdings tax law in response to the formal notice received from the European Commission. As a result, distributions made by a French company to branches or companies located in the EU or EEA which are in a loss position and in the process of being wound up will be exempt from withholdings tax, effective January 1, 2016.
The Bill also made changes to the participation exemption on dividends ensuring that the exemption is extended to dividends paid to EEA based parent companies (not just EU based), and dividends paid to EU based parent companies will explicitly include bare ownership of shares.
Additional measures included in the Bill address innovation incentives granted to SME’s (which will now only apply to SME's of less than 10 years), the introduction of a consultative committee on R&D and the extension of tax credits offered to enterprises in rural regions to 2020.