Current News

In this chapter you can find news of tax politics, currents law changes as well as comments regarding linked consequences in the daily business.

27/12/10 - France strengthens its provisions combating abuse of law

The abuse of law procedure allows tax authorities to disregard fictitious acts and acts seeking to literally apply texts or decisions for the purpose of avoiding or decreasing the amount of taxes that the taxpayer would have normally paid. In summary, the abuse of law covers fictitious legal situations, legal evasion but also acts seeking the benefit of a literal interpretation of texts or decisions.

Rectifying finance law for year 2008 already amended article L 64 of the Tax Procedures Code to extend the procedure of abuse of rights to all taxes. The procedure applies to any abuse with respect to the tax basis, the assessment or the payment of the tax.

French tax administration releases three notices dated 9 September  2010 (13 L-9-10, 13 M-2 to 10 and 13 N-3-10) where it provides further comments regarding  the definition, procedure of abuse of law and relevant penalties.

French tax authorities say among other things that the application by a taxpayer of a binding administrative doctrine on the basis of Article 80 A of the Tax Procedures Code can be challenged on the grounds of abuse of law (article 80 A of the Tax Procedure Code allows taxpayers to oppose the Administration its own doctrine). In doing so the  administration extends the scope of abuse of law to all administrative decisions (notices, decisions or rulings) that go beyond a simple comment and create law.

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