Increase in foreign worker tax

Published: 19 May 2017

Increase in foreign worker tax
Invoice financing

The FTA has revealed plans by the French government to charge foreigners who work in the country for temporary roles a €40 fee. This is set to be in place from New Year’s Day 2018, with the fee being levied on workers providing support in France by companies based outside of the country.

European FTA Policy Head: Pauline Bastidon stated the updated charge amounts to a restrictive tax on international transport which is managed by foreign firms.
 “The fee of €40 per driver is excessive and, simply put, is a protectionist measure designed to close the French transport market to any operator established outside of France,” Ms Bastidon told reports.
“It will disproportionately increase the cost of operating in France, and could have negative consequences for international transport to and from the country.”
 “Last July, the French government implemented regulations requiring all foreign drivers be paid the French minimum wage while operating on French soil,” said Ms Bastidon.

“In addition, companies are required to provide paperwork proving this and keep a representative in the country at all times.”

Ms Bastidon said this however had, perhaps unwittingly, led to the emergence of a market for representatives.
“Unless companies have an office in France, they will need to tack the cost of representation – as well as the fee – onto the cost of doing business in the country,” she said.
According to the legislation – introduced by the former government led by Francois Hollande – the €40 will be used to cover the maintenance fee for a database of compliant drivers.
“We are holding out some hope that the new French government will reverse this policy,” said Ms Bastidon.
Chairman of Rail Freight Group: Tony Barkeley felt the new cost would create “absolute chaos” in the logistics sector, in addition to breaking the law under EU guidelines.
 “The European Commission should come down on this like a ton of bricks,” he said.
France’s choice to impose domestic minimum wages on those working on an international scale also resemble regulations in Germany and Austria, with Italy developing a similar concept.
“While the commission appears empathetic and has protested these regulations, it seems to be moving quite slowly,” said Ms Bastidon. “We are asking it to step up the pace.”
With the Commission’s disapproval, Italy has plans on hold while specific requirements and regulations are met as part of the commission’s Mobility Package on 31st of May.
Ms Bastidon stated that this is far from over, as EU members and council members are the first to assess plans, which will probably lead to amendments before the updated plans can be put into action. 
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