How vat / sales tax works in France
French VAT (TVA) defaults to 20% on most sales of goods and services, with businesses collecting the tax, deducting input VAT, and remitting the balance through CA3 monthly or quarterly returns.
A 10% intermediate rate covers restaurants, hotels, passenger transport, and renovation works, while 5.5% applies to basic food, books, and qualifying energy renovation, and a 2.1% special rate covers reimbursed medicines and press.
Small businesses under the franchise thresholds bill without VAT but cannot recover input VAT, while larger traders file CA3 returns or the annual CA12 regime depending on turnover and liability.
Tax rates at a glance
- Standard VAT
- 20%
- Intermediate VAT
- 10%
- Reduced VAT
- 5.5%
- Special rate
- 2.1%
- Overseas departments
- 8.5% / 2.1%
- Exports and intra-EU B2B
- 0%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
E-commerce sellersFreelancersExpatsFoundersHospitality operators
Watch out for
- Restaurant billing splits rates on one ticket: food at 10% and alcoholic drinks at 20%, so single-price menus need apportionment rules rather than one blended rate.
- Since August 2025 the 5.5% rate on gas and electricity subscriptions is gone, with 20% applying instead, which changed household and landlord cost models.
- Overseas departments use 8.5% and 2.1% instead of mainland rates, while French Guiana and Mayotte sit provisionally outside VAT, so DOM sales need separate treatment.
- Franchise-exempt traders cannot deduct input VAT, which makes the simplification expensive for businesses with heavy equipment or stock purchases.
Frequently asked questions
What is the standard VAT rate in France?
The standard French VAT rate is 20% in 2026. Reduced rates of 10%, 5.5%, and a special 2.1% apply to defined categories such as food, transport, books, press, and medicines.
What VAT applies to restaurants in France?
On-site and takeaway restaurant food is generally 10%, while alcoholic drinks stay at 20%. Mixed menus must split the taxable bases between the two rates.
Do small French businesses charge VAT?
Not necessarily. Businesses below the franchise-en-base turnover thresholds invoice without VAT, but they give up input VAT recovery, so growing firms usually exit the scheme deliberately.