France Publishes Tax Interpretations Related to the Development of Certain Islamic Finance Transactions in France

On December 19, the French Ministry of Finance published various binding interpretations concerning the French tax treatment of certain Islamic finance transactions in France. These interpretations discuss the corporate income tax, withholding tax, VAT, registration tax and business tax treatment of two categories of Islamic finance transactions: Murabaha and Sukuk transactions. Our Paris office has recently developed significant expertise in this area, in particular by participating in the Ministry of Finance working group dedicated to the introduction of Islamic finance in France, whose work served as the basis of those interpretations. These new interpretations create new opportunities for shariah-compliant investments in France.