Multinationals: the National Assembly narrowly votes to tax profits made in France, the government objects

During the night of Tuesday 27 to Wednesday 28 October, the National Assembly adopted, by 74 votes to 72, an amendment to the 2027 finance bill that changes the way multinationals' corporate tax is calculated. According to LCP, the text aims to tax the share of a group's global profits that corresponds to its real activity in France, rather than only the profits the group chooses to declare in France. The vote came a few hours after the surcharge on large companies' profits was scrapped, also by a two-vote margin.

The facts

The amendment was tabled by MP Nicolas Sansu (Gauche démocrate et républicaine group) and defended in the chamber by Emmanuel Maurel. According to LCP, Maurel put forward a figure of 36 billion euros in profits that allegedly escape tax in France through tax optimisation. Similar amendments, tabled by Éric Coquerel (LFI) and Jean-Philippe Tanguy (RN), were rejected: the first on a tied vote, 72 to 72, the second more clearly, by 110 votes to 59.

The budget's general rapporteur, Philippe Juvin (Droite républicaine), and the Economy Minister, Roland Lescure, both gave an unfavourable opinion. The minister called the measure a "very bad idea", while acknowledging, according to LCP, that the problem of tax optimisation is real. There is a precedent: in autumn 2025, a comparable measure backed by LFI had already been passed at first reading of the 2026 budget, franceinfo reported at the time, against the government's advice.

The positions at stake

Opponents put forward a serious legal argument. For Philippe Juvin, the tax treaties signed by France and international rules only allow the taxation of profits linked to a presence on French territory. Changing the tax base unilaterally would expose the country to litigation, double taxation and possible retaliation. The government prefers to renegotiate bilateral treaties. During the debate on the surcharge, several centrist and right-wing MPs also invoked international competition, according to Elections 2027, an argument that weighs on any increase in the taxation of large groups.

Supporters of the amendment reply that the status quo is costly. Estimates vary depending on the method, but they agree on the scale of the phenomenon. The Conseil d'analyse économique, attached to the Prime Minister's office, estimated in 2019, according to AFP, that tax avoidance by multinationals costs France at least 4.6 billion euros a year in tax revenue, a figure its authors considered cautious. More recently, a CEPII letter published in March 2026 estimates that around twenty billion euros in profits were shifted out of France in 2018, mainly through the manipulation of transfer prices between subsidiaries of the same group, and puts the "missing" profits in the country at around 41 billion.

Analysis

The debate is less ideological than it seems. That a company pays tax where it declares its profits rather than where it sells, produces and employs is an anomaly that nobody defends on the merits. An SME in Clermont-Ferrand or Lorient has neither a subsidiary in the Netherlands nor a department dedicated to transfer pricing: it pays the full rate. This inequality before taxation erodes consent to tax, one of the foundations of the republican compact.

But the government's objection is not a mere pretext. A France that legislates alone risks seeing the measure struck down or circumvented. The multilateral route has in fact produced results, with the 15% global minimum tax agreed at the OECD in 2021. It also shows its limits: according to Le Club des juristes, Washington announced in January 2026 that it had secured an exemption from this mechanism for multinationals headquartered in the United States. Waiting for the common rule to impose itself means accepting that the most powerful write its exceptions.

Then there is the budget context. The revenue part of the finance bill has not completed its passage, and LCP points out that the executive could resort to Article 49.3, or even to ordinances, which would then revert to the initial text. Roland Lescure said on 11 October, according to AFP, that he would prefer to avoid the latter, which he compared to a safety barrier. Either way, the amendment voted overnight has little chance of appearing in the final version. After the surcharge was scrapped, the risk is to leave the image of a budget that gives up on asking the largest players to contribute.

Conclusion

Last night's vote settles nothing, but it raises the right question. Rather than opposing a fragile amendment with a refusal in principle, the government could take the initiative: take to Brussels, together with the states that share this view, a common corporate tax base founded on real activity, and commit before Parliament to a precise timetable. A sovereign nation must be able to tax the wealth created on its soil. Will the executive make this a European battle, or let it vanish in a 49.3?

Article written with the help of artificial intelligence.