Drawing on a long-term set of tax data covering the period from 2005 to 2015, this report documents the rate of taxation on profits in France. The average effective tax rates on profits among non-financial companies remained relatively stable throughout the period under review, rising from 19 per cent in 2005 to 21 per cent in 2015.
Large companies benefit from lower effective rates than other companies. Thus, in 2015, the average implicit rate for large companies was 17.8 per cent, compared with 23.7 per cent for SMEs.
Nevertheless, there has been some convergence in the implicit tax rate for large firms compared with other firms. Thus, the average implicit tax rate for large enterprises rose from 10 per cent to 17.8 per cent, whilst the average implicit tax rate for SMEs fell slightly, from 27.7 per cent to 23.7 per cent. This convergence is explained by the declining role of the deductibility of financial expenses.
Finally, the report analyses the dispersion of tax rates. Whilst they are the subject of sustained attention, differences between company size categories or between sectors account for only a minimal proportion of the variance in implicit tax rates over the period. Heterogeneity between firms persists over time and does not reflect temporary situations.
