France Levies Tax On Commercial Signs

by Ulrika Lomas, Tax-News.com, Brussels

12 January 2010

The introduction of a new local tax levied on external advertising in France (une taxe locale sur la publicité extérieure – TLPE) has provoked outrage among traders, many of whom believe that the new tax is merely another means for the government to compensate for the abolition of local business tax.

Designed to “reduce visual pollution,” and to encourage large shops to adopt a more discrete approach, the levy was instituted on August 4, 2008 within the framework of the law to modernize the economy (Article 171).

The TLPE tax simplifies the existing system, as it replaces both the tax imposed on advertising displays (la taxe sur les affichages publicitaires – TSA) and the tax levied on advertising sites (la taxe sur les emplacements publicitaires – TSE). Although the tax came into force on January 1, 2009 (payable from January 2010), the government anticipates a transition period until 2013.

The new tax is to be levied on signs, and on any inscription, form or image that is either affixed to a building or visible on the shopkeeper’s land.

Given that external advertising is currently one of the three most popular forms of advertising media, along with the television and press, the TLPE will inevitably have a huge impact on businesses in France. Small traders will not, however, be subject to the levy, provided that the signage area does not exceed 7 square meters.

According to the Trade Council of France (le Conseil du Commerce de France), around 85 towns applied the TSA and 3,000 the TSE in 2008. Although the TLPE is indeed optional, as with the previous system, currently around 4,300 towns have opted to apply the new levy.

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