VAT Rates in France: The Complete Guide

In France, VAT (Value Added Tax) is everywhere. Whether you’re selling goods, providing a service, or simply buying everyday products, you’ll inevitably come across this indirect tax. But behind the appearance of a single rate lies a more nuanced reality: several rates coexist, each applying to a specific category of goods or services.
Understanding the logic behind French VAT rates is essential for any business : retail, services, hospitality, or healthcare. Apply the wrong rate, and you risk a tax audit or a margin loss.

VAT Rates Applicable in France

French VAT is built around four main rates set out in the French General Tax Code (CGI). These rates vary depending on the nature of the goods or services. Specific rates also apply in Corsica and the French overseas departments and regions (DROM).

1. Standard VAT Rate: 20%

The standard rate is 20% (Article 278 of the CGI). It applies to most goods and services, unless a reduced or special rate specifically applies. This includes:

• Non-essential everyday consumer products (clothing, appliances, electronics, cosmetics, etc.);
• General services (hairdressing, beauty treatments, personal services, professional/freelance activities);
• Energy products (electricity, gas, fuel, sawn timber);
• Alcoholic beverages and tobacco;
• Chocolate-based products and margarine;
• Pet sales.

It also applies to certain services: pool admission, gyms, vehicle rentals, leasing services, and more.

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2. Intermediate VAT Rate: 10%

The 10% reduced rate (Articles 278 bis to 279 of the CGI) applies to goods or services considered partly essential or of general interest, such as:

• Passenger transport;
• Hotel accommodation, furnished rentals, classified campsites;
• On-site and takeaway food service (excluding alcoholic beverages);
• Renovation and maintenance work on housing over two years old (subject to conditions);
• Non-reimbursed medicines;
• Admission to museums, zoos, monuments, fairs, exhibitions, and funfairs;
• Unprocessed agricultural products, firewood, organic fertilizers and plant protection products.

3. Reduced VAT Rate: 5.5%

The 5.5% reduced rate (Articles 278-0 bis et seq. of the CGI) is designed to improve access to essential or public-interest goods:

• Food products;
• Feminine hygiene products and condoms;
• Equipment and services for people with disabilities;
• Books, regardless of format;
• Gas, electricity, or renewable-energy heating subscriptions;
• School canteen meals;
• Tickets for live performances and cinema;
• Certain works of art (import or delivery);
• Social or emergency housing, homeownership schemes;
• Energy efficiency renovation work.

4. Special VAT Rate: 2.1%

The 2.1% super-reduced rate (Articles 281 et seq. of the CGI) applies to very specific sectors:

• Medicines reimbursed by French social security;
• Sales of live animals for slaughter or meat processing to private individuals;
• Press publications registered with the CPPAP;
• The public broadcasting contribution;
• The first 140 performances of certain shows (theatre, circus, concerts).

VAT Rates in Corsica and the French Overseas Territories (DROM)

In Corsica (Article 297 of the CGI):

• 13%: petroleum products;
• 10%: construction work, agricultural equipment sales, furnished accommodation, low-voltage electricity, food service;
• 2.1%: water, non-alcoholic beverages, passenger transport;
• 0.9% : live shows (first 140 performances), sales of animals for slaughter to non-taxable persons.

In the DROM (Articles 294 et seq. of the CGI):

• 8.5%: standard rate;
• 2.1%: reduced rate;
• 1.75% and 1.05%: special rates;
• VAT does not apply in French Guiana or Mayotte.

How to Calculate VAT in France

Calculating VAT correctly is essential when setting a sale price, issuing an invoice, or checking that the right rate has been applied. The formula depends on whether you’re starting from a net price or a gross price.

Calculating VAT from a net price:

VAT amount = Net price × VAT rate
Gross price = Net price + VAT amount

Calculating VAT from a gross price:

To work back to the net price from a gross amount, apply the relevant multiplier:

VAT Exemptions in France

As a general rule, all economic transactions carried out for consideration are subject to VAT. However, French law provides for several exemptions, set out in the General Tax Code (Articles 261 to 291) and clarified in official tax guidance (BOFiP).

1. Transactions already subject to another tax : such as supplies already covered by specific duties (excise duties, registration fees) or certain banking/financial activities subject to insurance contract tax or financial transaction tax.

2. Activities of general interest (Article 261 of the CGI) : healthcare (doctors, dentists, physiotherapists, midwives), social care (retirement homes, supported housing), public or contracted private education, certain cultural events, and religious activities.

3. Intra-EU trade :  supplies to another EU Member State are exempt, provided the customer is VAT-registered in the destination country, the goods are actually shipped out of France, and documentary proof is available (invoices, delivery notes, the customer’s intra-Community VAT number).

4. Exports outside the EU : sales to non-EU countries are exempt from French VAT, provided the goods have genuinely left the EU, a customs export declaration was filed, and supporting documents are kept.

5. Some imports : including goods imported under a special customs procedure (temporary admission, inward processing), goods intended for re-export without alteration, and certain deliveries to international organizations or embassies.

6. Who is not liable for VAT? : employees, home-based workers paid as employees, individuals carrying out occasional activities without independence, and micro-entrepreneurs under the VAT exemption scheme (thresholds: €37, 500 for services, €50,000 for authors/performers, €37,500 for other liberal professions).

By contrast, company directors (e.g. SAS presidents, company managers) are considered to act independently and are therefore liable for VAT.

Do Foreign Businesses Need to Register for VAT in France?

If your business sells goods or services to French customers, or stores goods in France, you may need to register for French VAT, even without a physical presence in the country.

• Storing goods in France: there is no threshold, registration is required from your very first transaction.
• Distance selling to French consumers (EU businesses): a unified EU-wide threshold of €10,000 applies across all your cross-border B2C sales combined. Above this, VAT is due at the French rate.
• Non-EU businesses: registration is generally required from the first taxable sale, with no minimum threshold.

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Do You Need a Fiscal Representative?

If your company is established outside the EU, French law generally requires you to appoint a fiscal representative to register for and manage VAT in France. The representative acts as an intermediary with French tax authorities and becomes jointly liable for your VAT obligations.