Business France Nordic

Reforms in France: create a pro-business environment

In my view, there are three stages to economic transformation. The first is the new flexibility that social dialogue will provide. The second stage involves training, apprenticeship and unemployment insurance. The third one is to overhaul what is means to be a business.”

Emmanuel Macron

The Social Transformation Plan

Transforming employment law, rethinking apprenticeships, enhancing professional development, overhauling unemployment insurance benefit, undertaking pension reform, and improving purchasing power are the six pillars that will fundamentally reform France’s social model over the coming 18 months.

Read more: The French social model overhaul

French Finance Bills

The French Finance Bills for 2018 and 2019 include tax relief and labor cost reductions for businesses through two flagship measures that will benefit companies of all sizes in all sectors:

  • A sharp fall in corporate tax (IS), which will decline in stages from 33.33% at present to only 25% by 2022.
  • Transforming the competitiveness and employment tax credit (Crédit d’Impôt pour la Compétitivité et l’Emploi – CICE) into a permanent reduction in employer social security contributions from January 1, 2019.
  • Lower personal taxation through a fall in capital gains tax, now capped at 30% of investment income.

Read more: Tax news - 2018 French Government Budget Act

Read more: France's 2019 Finance Bill

The PACTE

The Business Growth and Transformation Action Plan (PACTE) addresses SMEs by pursuing several objectives: 

  • Free companies from complex rules by helping them clear the way, making it easier to start a business and reducing the number of workforce thresholds.
  • Create better-financed and more innovative companies, by making it easier to find diversified financing (IPOs, private equity, crowdfunding and ICOs). It will also channel private savings towards companies's equity to finance innovation and growth.
  • Foster fairer companies by amending the Civil code to reflect their expanded social and environmental role and allow them to develop a corporate rationale.

Read more: The Business Growth and Transformation Action Plan (PACTE) in 10 measures

The Big Investment Plan 2018-2022

The Government has embarked on a Big Investment Plan worth €57 billion, which will be implemented throughout the current five-year term to support structural reforms and respond to four major challenges facing France:

  • €20 billion for to accelerate the ecological transition
  • €19 billion to train and assist 2 million low skilled people in finding a job, and fund experiments in national education and support changes at undergraduate level
  • €9 billion for strengthening innovation and competitiveness
  • €9 billion to build the digital State

Read more: The Big Investment Plan 2018-2022