The French Finance Bill 2010

French Finance Minister Christine Largarde has amended some of tax provisions in the Finance Bill 2010 which we are explaining in following ways:

1st Carbon Tax for environment safety:-

I enjoyed reading about this new tax which ministry of France has introduced. Its name is carbon tax. It means that all companies, factories and transport industries who are using petrol, oil, gas and coal have to pay carbon tax. The standard tax rate will apply. 17 Euro per tonne will be carbon tax for production of carbon dioxide ( CO 2) by factories. The French govt. has taken this step for protecting environment.

After this, I have read some of introduction of carbon tax which I show here as quote.

A carbon tax is an indirect tax—a tax on a transaction—as opposed to a direct tax, which taxes income. A carbon tax is also called a price instrument, since it sets a price for carbon dioxide emissions. In economic theory, pollution is considered a negative externality, a negative effect on a party not directly involved in a transaction, which results in a market failure. To confront parties with the issue, the economist Arthur Pigou proposed taxing the goods (in this case fossil fuels) which were the source of the negative externality (carbon dioxide) so as to accurately reflect the cost of the goods' production to society, thereby internalizing the costs associated with the goods' production. A tax on a negative externality is called a Pigovian tax, and should equal the marginal damage costs.

2st. Withholding tax will apply on dividend, interest, royalties and remuneration income with 50% from 1st March 2010.

3nd. 5% tax will charge on French real estate transfer.

4rd 1.5% more progressive tax on the value added in product and services.