France to reduce corporate tax surcharge and ease employee buyouts in 2027 budget, PM says

PARIS, Sept 9 (Reuters) - France plans to reduce, but not abolish, the exceptional corporate tax surcharge imposed on very large companies in its 2027 budget, Prime Minister Sebastien Lecornu said in a letter to executives on Wednesday, pledging tax stability to support growth.

• The government, which lacks a majority in the lower house, is set to propose its budget in the coming weeks though several opposition parties have already said they would reject it.

• France introduced the temporary surtax on large companies in 2025 that was only supposed to last a year, but was rolled over into 2026 under a budget compromise.

• In the letter, Lecornu also said that the government planned to introduce a new tax incentive to encourage business transfers, particularly to employees.

• Under the planned "Papin Pact", companies taken over by staff would benefit from accelerated depreciation of new equipment needed for production, with enhanced support for small businesses.

• Lecornu said the government would review state support for businesses to determine whether they genuinely promoted investment, innovation, decarbonisation or production in France, or had become ineffective windfalls.

• He said there would be no new taxes in the 2027 budget, arguing that France could not restore its public finances by undermining economic growth.

• France's largest employers’ organisation Medef said it welcomed Lecornu’s message, saying it was necessary to address the concerns of business leaders.

(Reporting by Charlotte Van Campenhout; Editing by Alison Williams)