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French Constitutional Council Rejects Proposed Windfall Tax on Exceptional Profits of Large Companies Through Referendum — Orbitax Tax News & Alerts

The French Constitutional Council issued a release on Decision no. 2022-3 RIP of 25 October 2022, concerning a proposed bill creating an additional contribution (windfall tax) on the exceptional profits of large companies. The bill would provide for the introduction of an additional contribution on the exceptional profit of large companies whose turnover exceeds 750 million euros and whose taxable income for the financial year in question is greater than or equal to 1.25 times the average taxable income of financial years 2017, 2018, and 2019. The exceptional profit exceeding 1.25 times the three-year average would be subject to the additional contribution at progressive rates of 20% to 33%. The bill was presented on 21 September 2022 in application of Article 11 of the Constitution, which basically allows for a bill to be submitted to a referendum. However, the Constitutional Council has determined that the proposed bill does not meet the conditions for Article 11 and, therefore, may not move forward as proposed.