GENERAL TAX ON POLLUTING ACTIVITIES - FRENCH TAXATION
The general tax on polluting activities (Taxe Générale sur les Activités Polluantes or TGAP) was provided for in the 1999 finance act, by pooling the five former taxes and other mandatory levies earmarked to the environment and energy-mastering agency (ADEME). Its introduction aims at improving the incentive to protect environment, by applying the principle of « pay as you pollute ». The new tax referred initially to the dumping of garbage, the storage and elimination of special industrial waste, oil consumption, atmospheric industrial pollution and the noise generated by air traffic.
Pursuing an objective both environmental (fight against pollutions) and social (feeding the fund for financing employers’ social security contributions), the legislator decided in 2000 to extend the scope of the new tax to washing and softening products, natural mineral grains, anti-parasite products for agricultural use, and listed facilities. The taxation regime is inspired from the taxation methods applying to excise ; it is inserted in the French customs code in articles 266 sexies to terdecies.
The payer of this tax is the person who supplies for the first time after the domestic manufacturing or who provides the supply on the internal market after the purchase, importation or manufacturing in another Member State of the EC, or who sells these consumer products (washing detergents, natural mineral grains, anti-parasite products for agricultural use). The taxable event is the retailing on the domestic market, after domestic manufacturing or importation.
Rates vary according to the basis of taxable products. Exemptions provided for as regards TGAP (exportation or direct shipping to another Member State of the EC) have been enlarged by the article 24 of 2002 finance amendment act to the receipt of material and garbage considered as “inert”as they are called ( that is to say garbage which does not decay, burn out, produce chimical reaction or which is not biodegradable ).
TGAP is declared, checked and collected according to the rules, guarantees and penalties provided for in the field of customs. The yield expected from this new tax in 2004 should be € 498 million.