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Transfer Tax Hiked In Two-Thirds Of France

by Ulrika Lomas, Tax-News.com, Brussels

06 March 2014


The French Tax Administration has confirmed that 66 out of the 101 departments in France elected to increase their house transfer tax rate from March 1. The tax is imposed on transactions involving older property.

Notary fees have risen from 7 percent to around 7.7 percent in the majority of departments in France, thereby significantly increasing the cost of buying an apartment, house, or office.

Specifically, an individual purchasing an apartment for EUR300,000 (USD411,828) will have to pay EUR2,100 more this year in tax compared to 2013, while the purchaser of a EUR400,000 house will suffer additional costs of EUR2,800.

France's 2014 finance law provides that local authorities may raise their departmental transfer tax from 3.8 percent to 4.5 percent between March 1, 2014, and February 29, 2016. The measure is intended as a revenue-raiser for cash-strapped departments, hard hit by budget cuts, and soaring welfare costs.

It is expected that most of the other departments that have frozen their levies will – eventually – raise their fee. For the moment, however, it appears that some are waiting until after the municipal elections before striking.

TAGS: tax | business | law | real-estate | budget | fees | France | Tax

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