France: Tax-Efficient Sectors
The French government has taken steps to encourage investment in SMEs over recent years. A law of August, 2007 focussing on purchasing power, labour and employment in SMEs (TEPA) was passed to allow payments for overtime to be exempt from income tax and social security contributions up to a maximum of 21.5% of remuneration.
In addition, TEPA provides for a reduction in wealth tax of up to 75% up to a maximum of EUR50,000 investment for a taxpayer investing in a non-public SME.
Small and medium businesses investing in research and development are eligible for tax credits of up to 30% of their total R&D costs.