The New French “Land Tax” for Non-French Tax Residents

The French Parliament is currently deliberating the French Finance Act 2018 (“FFA”).  The French Senate is expected to vote on the FFA before the end of 2017.  Currently, the French wealth tax (“Impôt de Solidarité sur la Fortune”) is assessed on certain assets worth more than €1.3 million in net market value.  French tax residents are liable for the wealth tax on their worldwide assets.  However, non-French tax residents are only liable for the wealth tax on certain French-based assets, primarily French real estate assets.

The proposed FFA would replace the wealth tax with a new real estate wealth tax (“Impôt sur la Fortune Immobilière”), which would go into effect on January 1, 2018, and would only be assessed on real estate assets.  It seems likely the FFA will pass, and subsequently non-French tax residents holding French real estate assets should reevaluate their situation.