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French finance minister says he will change corporate tax plans
October 6, 2013 / 5:40 PM / 4 years ago

French finance minister says he will change corporate tax plans

PARIS (Reuters) - France will scrap plans for a new corporate tax which had been criticized by business leaders and instead temporarily increase existing taxes, Finance Minister Pierre Moscovici said in an interview with local media on Sunday.

The government had announced in its 2014 budget bill last month a change in corporate tax policy by removing an annual flat tax that existed on top of other levies and introducing a new one based on operating profits.

That new tax on operating profits was meant to bring in 2.5 billion euros ($3.40 billion).

The new tax “will not be”, Moscovici said in a joint interview with RTL radio, LCI television and Le Figaro daily.

“What we suggest is ... a temporary increase in (existing) corporate tax.”

The government will launch consultations with business leaders and other stakeholders before finalizing the new tax plans, he said. He did not say when he expected to hold those talks.

Moscovici reaffirmed President Francois Hollande’s target of cutting unemployment by year-end and reiterated his hope that the economy might do better than the government’s latest prediction of 0.1 percent growth this year and 0.9 percent growth in 2014.

National statistics office INSEE said on Thursday the euro zone’s second-largest economy would grow by 0.2 percent of GDP in 2013 and projected unemployment would stabilize by year-end at 11 percent after rising steadily for two and a half years.

Reporting by Ingrid Melander; editing by Andrew Roche

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