Sales Tax in France

By: EconomyWatch   Date: 14 October 2010

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Sales Tax in France is imposed on the sale of a commodity to a customer after its production. According to the retail organizations this tax is discouraging for the retail dealers. However, the progressive or the regressive nature of the sales tax is quite debatable. This tax can be precisely explained by the adage "You Pay for What You Spend" Tax. The necessary items are exempted from the tax purview since those items are bought by the rich and the poor equally. This tax is normally charged upon the luxury items which the rich can afford only.
Aspects of Sales Tax
The rate of sales tax does not vary and is constant. The intangible objects do not come within the purview of sales tax. In some countries sales tax is imposed on the receipt of services from lawyers and doctors. A sales tax cannot be increased without the increase in the other kinds of taxes. It is normally imposed on the manufacturer but in situations when it exceeds 8% or more it might be imposed at a lower rate as a general sales tax. France introduced this tax in 1920.

In France normally the general sales tax is imposed on the producer or trader. France follows the one stage sales tax imposition. In this country the overall tax rate is fixed at 2% and the sales tax levied ranges between 8% and 10% which is based on the assumption that three transactions have taken place between the producer and the consumer. This is considered to be quite a high rate of sales tax.


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