Until December 31, 2009, new businesses may be exempted totally or partially from income tax for 5 years when implanted in certain areas of the territory.
To qualify for preferential treatment, the headquarters of the new company and all of its business, human resources and equipment operation should only be implanted in an area of regional aid, an area of rural revitalization (ZRR) or an area of urban regeneration (ZRU).
Difficulties have arisen concerning the application of this exemption from certain companies doing some of their operations outside the eligible areas.
Thus, a law of 2003 introduced a relaxation for the exemption scheme for companies engaged in a non-sedentary (eg traveling salesman, construction company). These companies can benefit from the exemption if their total business conducted outside the area does not exceed 15% of their business. Beyond this threshold, only the portion of sales made in the area benefit from the exemption.
And in a recent decision very pragmatic, the State Council has adopted a position caring for enterprises performing services. He considers that they may benefit from the exemption when the headquarters of their company is located in an eligible area and it is actually in this place that are designed, organized and marketed their services. Never mind that Most of these performances take place, given their nature, outside the area and with outside providers.
If a stricter interpretation of the concept of activity in the areas of land involved could be conceived for an activity of producing goods, it is economically unrealistic for judges to have adapted this concept to the nature of the activity they had to consider. In this case, it was a creative event. The events produced by this company were well designed, organized and marketed the company headquarters, but the vast majority of customers were located outside the zone in places where services were physically carried out with the help of suppliers and subcontractors that are not installed in the area.
may therefore now eligible for tax exemption on profits companies with headquarters and new ways of operating are located in an eligible area and exercise:
- or all of their business in a or more eligible areas;
- or non-sedentary activity, provided they do not achieve more than 15% of their turnover outside the eligible areas;
- or any activity design and marketing headquarters even if the services are conducted outside this area. Copyright ©
SID Press - 2008
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