The French Public Finance Department has given its approval to an extension to the favourable VAT rate levied on the Canal+ and its linear TV services.
“These details clarify Canal+’s VAT regime in France,” the broadcaster said in a statement. “The clarification allows Canal+ to confirm the application of the reduced 10% rate for linear television services, which remain the core of Canal+’s business in France, as well as for services considered ancillary to television broadcasting.”
The 10% VAT rate is seen by CEO Maxime Saada as the device that allows Canal to be the leading funder of French cinema.
Last December, the Paris Administrative Court of Appeal confirmed that the VAT applicable to subscriptions to linear channels, such as Canal+ or OCS, should be increased from 10% to 20%. The move would have reflected the rise of streaming service and their importance within subscriptions.
However, the 3 September Official Bulletin states that when “the same commercial offer combines linear and non-linear services”, and in certain situations such as that of Canal+, “linear and non-linear services are taxed together at the reduced rate of 10%”.
The clarifications also make it possible to define what is and isn’t subject to a rate of 20%. According to Canal+, “these clarifications set out practical rules for determining the price of non-linear services marketed as an option to the basic offer”.
Discussions between Canal+ and the relevant authorities regarding previous periods are still ongoing.
