VAT exemption for exporters approved

Deputies approved a VAT exemption for wine and alcoholic beverage companies that export more than 85% of their sales, with the support of the government. The measure aims to ease financial pressure on sectors like cognac, which have been hit by global economic challenges.

Amendment proposed by a specific deputy

The amendment to the 2027 budget was proposed by Deputy Sandra Marsaud from the Renaissance party in Charente. It seeks to exempt these companies from VAT on purchases and operations needed for production, such as acquiring goods, transformation, and distillation.

Existing tax exemptions face limitations

A similar tax-free purchase scheme already exists, but its use is restricted by European rules that apply only to goods bought directly by exporters, not by their suppliers. Marsaud’s amendment aims to expand the exemption to cover suppliers’ purchases as well.

Cognac sector faces long-term decline

Cognac exports have been falling for five years, with a 20% drop in volume during the second half of 2025 compared to the previous year. Factors include higher U.S. tariffs, Chinese duties on distilled spirits, and reduced global alcohol consumption.

Other VAT changes approved and rejected

Deputies approved several VAT adjustments, including exemptions for essential goods, proposed by the RN and LFI parties. They also rejected a government plan to double VAT on pay television, which faced opposition from Canal+.

Government concerned about budget deficit

Public Accounts Minister David Amiel noted that the budget deficit has worsened by nearly 24 billion euros since the start of the 2027 budget’s first reading. However, the government may use the 49.3 or ordinances to override the deputies’ changes and finalize the budget.