No finance law for 2025: instead, a “special law” has been published.

As you know, the finance law for 2025 could not be voted on and promulgated before December 31st, 2024. Therefore, pending the presentation of a new finance bill by the new government and its vote by Parliament, a so-called “special law” has been prepared and voted on by the two chambers. It is technical legislation devoid of any political implication and is only intended to avoid any budgetary discontinuity until the adoption of a formal budget in the coming months.

Composed of four laconic articles, this unusual law has two objectives: to allow the State to continue to levy taxes and to authorize it, as well as the Social Security bodies, to borrow money in order to ensure the continuity of public services and State action, until the entry into force of the regular Finance Act for 2025 and Social Security Financing Act for 2025.

The non-renewal of many tax measures

But be careful, this special law does not provide for the renewal of the tax measures that expired at the end of 2024. Certain tax credits and reductions that were scheduled to expire on December 31st, 2024, are therefore not being renewed for the time being.

This is the case in particular of the Loc’Avantage scheme, the Malraux scheme in old run-down neighborhoods, the fixed allowance of €500,000 on capital gains on the sale of company shares by retiring directors, the innovation tax credit, the tax credit for the energy renovation of business premises, the tax credit for the training of business leaders and the temporary exemption from tax on profits in urban free zones-territories-entrepreneurs.

Another consequence of the absence of a finance law for 2025 is that the income tax scale will not be increased to be indexed to inflation. It, therefore, remains unchanged from the current scale, at least until the entry into force of the Finance Act for 2025.

In addition, as the gradual reduction of the contribution on the added value of companies (CVAE(1)) has not been frozen, it is expected to continue, with a maximum tax rate set at 0.19% for 2025, compared to 0.28% for 2024.

It should be noted that if these measures were to be renewed by the Finance Act for 2025 when it is adopted, it remains to be seen whether they would be retroactively applicable.

(1) Cotisation sur la Valeur Ajoutée des Entreprises (CVAE).