France: Official Comments on Special VAT Rates in Corsica

The French General Directorate of Public Finance recently published official comments on the rule for special VAT rates applicable in Corsica, explicitly focusing on Article 297 of the French General Tax Code. 

Corsica, like the French overseas territories Reunion, Guadeloupe, and Martinique, has different VAT rates than the rest of France. 

Special VAT Rates

Unlike in the rest of the French territories, the specific VAT rates in Corsica are 0.9%, 2.10%, 10%, and 13%. These rates apply to goods and services delivered or provided in Corsica, intra-EU imports and acquisitions, and product shipments from the mainland to Corsica.

A special rate of 0.90% applies to the first performance of certain shows. This may be confusing since it does not apply strictly to the first performance. As stated, this rate applies to the first one hundred forty theatrical performances of newly created dramatic, lyrical, musical, choreographic, or classical works that are the subject of a new staging.

Even musicians who present material already part of their repertoire may apply this rate as long as it is part of a new arrangement or musical.

In addition, a rate of 0.90% applies to transactions related to livestock sales intended for use as foodstuffs.

Other foods delivered to Corsica for human and animal consumption that produce foods for humans, agricultural products, and fish are subject to a special rate of 2.10%. Furthermore, this rate applies to goods delivered to Corsica, such as books, wood, wood products, fertilizers, and products for plant protection.

In addition to delivered goods, this special rate applies to services related to the specific short-term and long-term rental of accommodations, tickets for shows, exhibitions, zoos, and television subscriptions.

As the official comments explain, construction work, agricultural equipment, and specific sales are subject to a 10% VAT rate.

Finally, a special rate of 13% is applied to sales of petroleum products, such as butane, propane, gasoline, fuel oil, diesel, etc.

Conclusion

Comments and explanations government bodies provide are always valuable information, especially when clarifying particular aspects of rules and regulations.

Nevertheless, it is important to remember that these are the special VAT rates and that the standard VAT rate in Corsica is set at the same rate as in mainland France: 20%.

Source: Official comments BOI-TVA-GEO-10-10