Presented on 30 September 2015, this draft includes, amongst others, the following tax provisions – Distance selling regime → the French VAT taxation threshold would be decreased from 100 000€ to 35 000€…
I – Draft Finance Act for 2016
Presented on 30 September 2015, this draft includes, amongst others, the following tax provisions:
- Distance selling regime → the French VAT taxation threshold would be decreased from 100 000€ to 35 000€.
-> This provision would be applicable to supplies for which the chargeable event occurs from 1 January 2016. - Removal of low-efficiency taxes → the following three taxes would be concerned:
– Fractions ≪ authorization ≫ and ≪ exploitation ≫ of the General Tax on Polluting Activities (TGAP) referring to Classified Facilities for Environment Protection (ICPE) (article 266 sexies and 266 septies of the Customs code);
– Tax on first sales of cosmetic products (article 1600-0 P of the French tax code);
– Administrative tax borne by operators of electronic communications (article 45-VII of
– Finance Act for 1987 n°86-1317 of 30 December 1986).
-> This provision would be applicable from the tax established for year 2015. - Generalization of the Electronic Administrative Document (EAD) in the context of movement of alcohols and alcoholic beverages under excise duty suspension → the proposed amendments aims at making the EAD the reference document for the movement in France of goods under excise duty suspension. The paper document would be used only by travelling alambic renters, professional distillers and in general, by all those who do not have access to internet due to the absence of area coverage of their company.
-> This provision would enter into force on 1 July 2017. - Implementation of a guarantee waiver for small warehouse keepers of energy products → this would be a derogation to the mandatory provision of a joint guarantee by the warehouse keeper of energy products, to the benefit of small operators, by creating a threshold of taxable operations under which those operators, identified by the Customs authorities, would be exempt from this requirement.
-> In absence of specific mention, this provision would enter into force on the day after the publication of the Finance Act for 2016 in the Official Journal. - Provision aiming at fighting against concealment of VAT revenues: use of mandatory cash register software or non-fraudulent system → it is proposed to mandatorily use a secured software or system, i.e. satisfying conditions of inalterability, safeguarding, storage and archiving as well as a fine of 5.000€ penalizing the possession of a software by a company which would not be in position to justify the use of a secured software or system.
-> This provision would enter into force in a time-delayed manner to allow users of cash register software or system to take into account those new provisions. - Increase of the Insurance Premium Tax (IPT) rate on legal protection insurance → the current rate of 11,6% applicable to legal protection insurances referred to in articles L. 127-1 of the insurance code and L. 224-1 of the mutuality code, other than those having for exclusive or principal purpose to take in charge criminal defence and ordinary law recourse in view to obtain the compensation of a personal injury of the insured following an accident, would be increased to 12,5% for premiums issued from 1 January 2016 and 13,4% for premiums issued from 1 January 2017.
The above provisions may still be modified until the final adoption of the Finance Act for 2016 which should be published at the end of the month of December 2015.
II – VAT : Margin scheme and second-hand vehicles
Fraud on the VAT margin scheme on second-hand vehicles consists in unduly applying the VAT margin scheme to sales which are normally subject to the general VAT regime where VAT is applied on the total sales price. This leads to pay to the Treasury only a small part of the VAT normally due.
A decree of 24 June 2015 foresaw new modalities for requesting a tax certificate or ≪ tax quitus ≫, necessary for the registration of vehicles previously registered in another EU Member State, by buyers-resellers of second-hand vehicles and on justifying documents to provide for the application of the margin scheme.
The tax administration commented these new modalities through a BOFIP update on 2 September 2015. To allow operators to obtain the justifying documents (certificates or sales invoices) from their European partners, the tax office may deliver the tax certificate even if the sale invoice issued by the holder of the registration certificate (or statement signed by the latter) could not have been provided. This transitional measure applies to certificates delivered for intracommunity acquisitions carried out until 30 September 2015.
The DGFIP also published in September 2015 a sheet recalling the sanctions incurred by the buyerreseller who wrongly applies the margin scheme but incurred also by all actors of the invoicing chain transaction who knew or could not ignore that they took part in this fraud. This sheet contains also a list of clues allowing to identify at-risk suppliers (compulsory specific mention on the invoice, purchase price abnormally lower than the market price, doubt on the authenticity of a document delivered by the supplier, doubt on the second-hand character of the vehicle etc.).
Decree n°2015-725 of 24 June 2015
BOFIP news of 2 September 2015
http://www.economie.gouv.fr/files/files/directions_services/dgfip/controle_fiscal/montages_abusifs/Fiche_20_Indices_fraude_TVA_marge_VO.pdf
III –VAT : Reduced rate on e-books
In reply to a written question from a Member of the Parliament, the French Government has reiterated its position consisting in the alignment of the VAT rates of e-books and press online with the rates applicable to those under paper form. This is also in line with the position of the president of the European Commission, M. Juncker, who specified that VAT regulation should be technologically neutral. A reform in this sense will be presented in 2016 at the EU level.
RM Briand, JOAN 18 August 2015, question n°76225
IV –VAT : Modalities of correction of insufficiencies on VAT returns.
When an omission of taxable income related to an initial payable VAT return of a past accounting period is lower or equal to 4.000€ of VAT, the company can correct this mistake by adding the income not declared to those of the month during which the omission was discovered. It will have to indicate in the box reserved for correspondence the omitted revenue amount broken down by rate, corresponding VAT and period of completion of the transactions to allow the calculation of the latepayment interest which are legally enforceable.
When this omission concerns more than 4.000€ of VAT, the correction is made through the filing of a rectifying return related to the period to which the mistake refers, in the same conditions as the original return.
When an omission of taxable income relates to an initial VAT return showing a credit balance, the company can correct this mistake by adding the income not declared to those of the month during which the omission was discovered, irrespective of the amount of the regularized VAT amount.
BOFIP news of 3 June 2015
V – Energy taxation : New Customs duties rates applicable from 1 October 2015
The Customs administration updated in circular n° 15-052 of 22 September 2015 (Official Customs Gazette n°7085) the rates of Customs duties and taxes applicable to energy products listed in tables B and C of article 265-1 of the Customs Code related to the domestic tax on consumption of energy products (TICPE).
From 1 October 2015, the rates of the fee levied on behalf of the Professional Committee of Strategic Stocks (CPSSP) are modified.
Emmanuel Cotessat
