Co-funded by the European Union

France gets rid of a EUR10 tax on a short term contracts

  • Specific short-term contracts previously subject to a tax of EUR10 are now exempted

In 2019 France introduced a EUR10 tax on short-term contracts (contrats à durée determinée d’usage) concluded as of 1 January 2020. The short-term contracts subject to this tax were the ones where, due the nature of work, a short-term contract was usually proposed, with limited exceptions. The measure aimed at encouraging companies to make use of employment contract of longer duration.

However, due to the repercussions of Covid-19 on the economy and employment, an amendment to the Law passed on 30 July 2020 and the tax was removed as of 1 July 2020.

The deputies proposing the amendment underlined how encouraging employment is key during these difficult times. This type of contracts where used in the sectors that have been hit the most and therefore need further support.