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A Competitive Cost Structure

France is on the Move

Proof that France is attractive to investment is that every year more than 600 foreign investors choose to make new job-creating investments here, drawn by competitive conditions in which to establish and operate their businesses.

Set up and operating costs: France in a strong position

KPMG’s “Competitive Alternatives” guide to international business location options, which compares the costs of setting up and operating companies in nine industrialized countries and five emerging countries, ranks France ahead of Italy, the United States, Germany, Australia and Japan.
 
 
Total labor costs in France (salaries and wages, statutory plans, other benefits) are lower than in the United States, Germany, the Netherlands and Japan. (Source: KPMG, Competitive Alternatives, 2012)
 
France is ranked first in Europe for R&D operations and sixth for manufacturing operations by effective corporate tax rates, which take into account different tax bases, capital depreciation rules, exemptions and tax credits. (Source: KPMG, Competitive Alternatives, 2012)
 
The cost of renting office space (in euros per square meter per year) is lower in Marseille (€240/sq. m.) and Lyon (€260/sq. m.) than in Frankfurt (€408/sq. m.) or Amsterdam (€423/sq. m.); costs in Paris’s business district (€820/sq. m.) are lower than in London’s West End (€1,393/sq. m.). (Source: Cushman & Wakefield, Office space across the world, 2013)
 

Lower labor costs

 
France’s “National Pact for Growth, Competitiveness and Employment” unveiled in November 2012 announced a €20 billion reduction in labor costs per year for companies.
 
Accordingly, a new competitiveness and employment tax credit (CICE) will be calculated in proportion to the company’s gross payroll costs (4% in 2013, then 6% from 2014), excluding salaries higher than 2.5 times the national minimum wage.
 

One of the world's most competitive energy market

 
France is the leading country in the world for the quality, availability and accessibility of its electricity supply. (Source: KPMG / Institut Choiseul, 2012)
 
Electricity rates for industrial use excluding VAT (€0.067/kWh) are lower than in Germany (€0.089/kWh) and the United Kingdom (€0.115/kWh). (Source: Eurostat, 2013)
 
Natural gas rates for industrial use (excluding VAT) are lower in France (€0.039/gigajoule) than in Germany (€0.044/gigajoule), and remain lower than the European average. (Source: Eurostat, 2013)
 

Higher tax credit for international film productions

 
The ceiling for France’s 20% tax rebate for international productions (TRIP) is to be increased from €4 million to €10 million per film by 2014.
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