French FTT: Taxation of intraday transactions and higher rate?

On Wednesday night, members of the French Parliament have voted an extension of the scope of the French financial transaction tax (FTT) aiming at including intraday transactions and an increase of the rate.

It is not the first time that the idea of a tax on intraday operations is proposed. In 2014 and during the 2016 Finance Bill debates in 2015, two amendments had been proposed (and rejected) in order to levy FTT on intraday transactions. The arguments put forward where almost the same: these operations are regarded as speculative and as a risk factor on financial markets. Moreover, the potential additional tax revenues would provide funds for development assistance to poor countries. This measure would be in conformity with the European FTT project that seems to include intraday transactions in the scope of the tax.

If voted in the final version of the Finance Bill; this measure would come into force on 1 January 2017.

In addition the rate of the French FTT would increase from 0.2% to 0.3%.

This takes place in parallel of new discussions on the European FTT where apparently the 10 participating Member States have reached an agreement on some of the European FTT aspects (wide scope including market-making activities that would be taxed with a discounted rate).

Hélène Alston

Hélène Alston, Partner, is specialized in financial taxation, and particularly in asset management. She advises management companies, depositaries and French and foreign institutional investors. Hélène assists her clients with operational […]

Etienne Genot

Etienne Genot, Partner, heads the French Financial Services tax and legal Practice. He has nearly 20 years’ experience on the financial services sector working for banks, insurance companies and investment […]