Following a government error leading to the reduction of a tax reduction on furnished tourist accommodation, a note was published by the administration to maintain it.
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On Monday, July 8, the Council of State annulled the paragraph allowing Airbnb-type rentals to continue to benefit from a tax niche, acceding to a request from professional tourism organizations. This niche had been mistakenly reduced by the government in the 2024 finance law. The passage annulled by the Council of State indicated that taxpayers could continue to apply provisions prior to the 2024 finance law to 2023 income, “in order to limit the consequences of retroactive application”.
A hitch occurred during the examination of the state budget in the fall of 2023. The government had forgotten to remove an article introduced by the opposition that significantly reduced the tax allowance for furnished tourist accommodation. The article planned to lower the allowance to 30% in areas that have difficulty accessing housing. In mid-February, a note in the Official Bulletin of Public Finances dedicated to taxes finally reintroduced this tax allowance of up to 71% of the turnover generated by furnished tourist accommodation rentals.
In practice, since the decision of the Council of State is not retroactive, taxpayers who have declared their income for 2023 on time will not be concerned. However, “in light of this decision, a taxpayers’ association could consider suing the State for the loss of revenue to public finances that the maintenance of this tax loophole represented against the advice of Parliament”, says Senator Ian Brossat, who welcomes “of a major political victory”.
