Local Taxes: Which Ones Apply to Your Business?
If you operate a business in France, several local taxes may apply to you. Some are mandatory and benefit local authorities, while others are optional and depend on decisions made at the local level. Here’s an overview of the key local taxes that could affect your business.
Overview of Local Business Taxes
Mandatory Local Taxes
Business Property Contribution (CFE)
The Cotisation Foncière des Entreprises (CFE) is one of two components of the Local Economic Contribution (CET). It applies to all businesses, whether individuals or legal entities, that carry out a non-salaried professional activity as of January 1 of the tax year. This includes micro-entrepreneurs, who are subject to the same rules as other businesses.
👉 Learn more about the Business Property Contribution (CFE)
Corporate Value-Added Contribution (CVAE)
The Cotisation sur la Valeur Ajoutée des Entreprises (CVAE) is the second component of the CET. It targets businesses that are subject to CFE and generate a minimum turnover threshold. Both individuals and legal entities are liable for this tax if they meet the revenue criteria.
📌 Note: The CVAE is being gradually phased out, with its rate reduced by 25% each year until it is fully abolished in 2027.
👉 Learn more about the Corporate Value-Added Contribution (CVAE)
Flat-Rate Tax on Network Companies (IFER)
The Imposition Forfaitaire des Entreprises de Réseaux (IFER) applies to businesses operating in sectors such as energy, telecommunications, and rail transport. Each type of facility is subject to specific tax bases and calculation methods. The tax is levied annually on the operator of the facility in question as of January 1 of the tax year.
👉 More about the Flat-Rate Tax on Network Companies (IFER)
Property Tax on Built Land (TFPB)
Businesses that own or hold the usufruct of built property as of January 1 are subject to the Taxe Foncière sur les Propriétés Bâties (TFPB). In certain cases, partial or full exemptions may apply depending on the nature of the property and the owner’s situation.
👉 Learn more about the Property Tax on Built Land (TFPB)
Property Tax on Unbuilt Land (TFPNB)
The Taxe Foncière sur les Propriétés Non Bâties (TFPNB) applies to owners or usufructuaries of undeveloped land as of January 1. As with the TFPB, exemptions or reductions may be granted under specific conditions.
👉 Details on the Property Tax on Unbuilt Land (TFPNB)
Tax on Retail Space (TaSCom)
The Taxe sur les Surfaces Commerciales (TaSCom) is levied on certain retail establishments. It is collected by local municipalities and public intercommunal cooperation establishments (EPCI). The tax base is the retail sales area measured on December 31 of the previous year or on the date the business ceases operations.
Rates vary depending on the annual revenue per square meter, the size of the retail space, and the type of retail activity.
👉 More about the Tax on Retail Space (TaSCom)
Optional Local Taxes
Some local taxes are not mandatory and can be introduced at the discretion of local councils or intercommunal bodies. Here are several that may affect your business if implemented locally:
Tourist Tax
The taxe de séjour, or tourist tax, can be applied by municipalities with tourism-based economies. It can be collected in two ways: on a per-visitor basis or as a fixed rate. The applicable rates vary based on the type of accommodation and are determined by local authorities within legal limits.
Tax on Vacant Commercial Premises (TFC)
The Taxe sur les Friches Commerciales (TFC) targets commercial properties that have been vacant and unused for at least two years as of January 1. This tax is designed to encourage the reuse of abandoned commercial spaces and may be enacted by local governments seeking to revitalize their business districts.
👉 Learn more about the Tax on Vacant Commercial Premises (TFC)
Local Tax on Outdoor Advertising (TLPE)
The Taxe Locale sur la Publicité Extérieure (TLPE) may be established by municipalities or EPCIs for advertising installations located within their territory. It applies to any business that uses signage, pre-signs, or advertising panels—regardless of their business sector. The tax is assessed based on the presence of these installations as of January 1 of the tax year.
👉 More information on the Local Tax on Outdoor Advertising (TLPE)
