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Contributions and social contributions
Gradual reduction of the EAC until its abolition in 2027
Publié le 05 janvier 2024 - Mise à jour le 23 mai 2024 - Directorate for Legal and Administrative Information (Prime Minister)
Initially planned for 2024, the abolition of the company added value contribution (VAAC) will finally take place on 1er January 2027. Moreover, it is no longer possible to benefit from an optional exemption from CVAE or an optional reduction since 1er January 2024.
The 2024 budget provides for the extension of the end of the CVAE to 2027.
The abolition of the CVAE is an administrative burden and a reduced tax burden for the employer. In addition, half of the companies liable to the CVAE will no longer pay it as of 2024 due to the removal of the minimum CVAE contribution.
The Official Bulletin of Public Finances (Bofip) states that since the 1er January 2024, it is no longer possible to apply for an optional exemption from CVAE or an optional rebate. Therefore, only companies benefiting from this exemption or rebate before 1er january 2024 will continue to benefit.
Phasing out until 2027
The company value added tax (VAAC) will be phased out in 2027. This contribution is currently payable by companies or persons who are self-employed and who generate an annual turnover (CA) excluding tax of more than €500 000. It should be added that companies with a CA excluding tax of more than € 152 500 only have to make a declaration of value added and employees.
By 2023, the EAVC had been cut in half. The overall tax rates of the CVAE will then be gradually reduced until its abolition in 2027:
Turnover excluding tax | Effective Tax Rate 2023 | Effective Tax Rate 2024 |
|---|---|---|
Less than €500,000 | 0% | 0% |
Between €500,000 and €3 million | 0.125% x (CA - €500,000) / €2.5 million | 0.094% x (CA - €500,000) / €2.5 million |
Between €3 million and €10 million | 0,125 % + 0,225 % x (CA - €3 million) / €7 million | 0,094 % + 0,169 % x (CA - €3 million) / €7 million |
Between €10 million and €50 million | 0.35% + 0.025% x (CA - €10 million) / 40 million% | 0,263 % + 0,019 % x (CA - €10 million) / 40 million % |
More than €50 million | 0.375% | 0.28% |
Turnover excluding tax | Effective Tax Rate 2025 | Effective Tax Rate 2026 |
|---|---|---|
Less than €500,000 | 0% | 0% |
Between €500,000 and €3 million | 0.063% x (CA - €500,000) / €2.5 million | 0.031% x (CA - €500,000) / €2.5 million |
Between €3 million and €10 million | 0.063% + 0.113% x (CA - €3 million) / €7 million | 0,031 % + 0,056 % x (CA - €3 million) / €7 million |
Between €10 million and €50 million | 0,175 % + 0,013 % x (CA - €10 million) / 40 million % | 0,087 % + 0,006 % x (CA - €10 million) / 40 million % |
More than €50 million | 0.19% | 0.09% |
In order to obtain the amount of the EAAC, this must be multiplied by the taxable value added of the company.
Please note
The company with a turnover of less than €2 million will benefit from a €188 reduction in CVAE in 2024 (compared to €250 in 2023).
Abolition of the minimum CVAE contribution
The minimum CVAE is abolished by the 2024 budget. This amounted to €63 in 2023.
Thus, the CVAE is not due where its annual amount is not more than € 63.
This is expected to reduce by half the number of companies liable for the ECVC.
Increase in the rate of the additional fee for the CVAE
In addition, in order to preserve the resources of the regional Chambers of Commerce and Industry (CCIs) that benefit from the payment of the additional tax to the CVAE, the rate of the additional tax is increased to 9.23% the amount of the CVAE for the year 2024 (compared with 6,92 % in 2023).
Consequences for the territorial economic contribution and the land contribution of the companies
Since the territorial economic contribution (CET) is made up of the CVAE and the companies' land contribution (CFE), its capping rate has been modified for 2024. It is now set at 1.531% added value. This rate applies to the sum of the 2024 EAAC and EAC due.