On 28 December 2011, the French Constitutional Court validated the fourth Amending Finance Law for 2011 (AFL 2011) and the Initial Finance Law for 2012 (IFL 2012).

Following the measures announced by the Prime Minister on 24 August 2011, the French State hopes to reduce the public deficit to 4.5% of France’s gross domestic product (GDP) in 2012, then to 3% of the GDP in 2013. The two laws thereby implement certain fiscal measures from the Public Deficit Reduction Plan, such as the creation of an exceptional contribution on high incomes and an increase of the tax rate on investment income.

We have summarized below the principal measures of these finance laws affecting companies and individuals.