• Service: Tax, Global Mobility Services
  • Type: Regulatory update
  • Date: 7/10/2014

France - Charitable donation tax rules referred to CJEU 

July 10: The European Commission today announced the referral of France to the Court of Justice of the European Union (CJEU) regarding the French tax system for donations made to charitable entities having their registered office in another EU or EEA Member State.

As explained in today’s EC release, France exempts from registration duties— i.e., taxes on transfers without consideration (droits de mutation à titre gratuit)—donations and bequests made to public or public-interest bodies / charities when the entity is established in and conducts its activities in France.

Comparable entities established or conducting similar activities in other EU Member States are subject to a 60% tax (calculated above a threshold of €1,594) on the value of the donation or bequest received. France has entered into a number of bilateral agreements that provide an exemption from such taxes / duties on a reciprocal basis.

This EC has found that this different treatment may deter French taxpayers from making donations or bequests to charities established outside France.

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