French Assembly Reduces Tax On Private TV Channels

by Ulrika Lomas, Tax-News.com, Brussels

14 December 2009

The French National Assembly has adopted an amendment which aims to reduce the rate of tax levied on the advertising revenue of private television channels in 2009.

Put forward by Patrice Martin-Lalande, the amendment has been adopted within the framework of the 2009 supplementary finance bill, due to be examined by the Senate on December 17 and 18.

Although French Budget Minister Eric Woerth has given the government’s support to the measure, he has, nevertheless, limited its application to 2009, and not 2010 as originally proposed.

Parliament adopted the tax on advertising revenue at the beginning of the year, in order to compensate for the progressive ban on advertising imposed on public television (France Télévisions). The tax is levied at a variable rate of between 1.5% and 3% on the turnover of private television channels.

The amendment reduces this variable rate, and provides that the tax rate for 2009 will be 0.5% for any channel reporting a loss in turnover of greater than 5%, and 1% for any channel experiencing a loss in turnover of below 5%. It also proposes that the tax rate is reduced to 0.5% in 2009 for TNT channels.

TF1 reported losses in advertising revenue of 19% from January to September, while M6 noted a loss of 11.4%.

Defending the proposal, Woerth explained that the amendment merely takes into account economic reality, and the decline in the advertising market.

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