Corporate Tax in Europe 2026: From 9% to 35%, Where Does France Stand?
From Hungary (9%) to Malta (35%), the standard corporate income tax rate varies fourfold across the European Union. France, at 25%, sits above the EU average (20.8%) and ranks fourth among the countries that tax profits the most. A few kilometres from Geneva, Switzerland applies combined rates of 12% to 21% depending on the canton. A map that weighs on where companies choose to set up.
A note on method: the rates below are the standard rates of tax on corporate profits, national and local levels combined, excluding reduced SME rates, surcharges reserved for large companies, and taxes based on value added or turnover (Italy's IRAP, France's CVAE). This is the only strictly comparable basis from one country to another.
A continent moving at several speeds
The 27 Member States fall into four groups:
30% and above: Malta (35%); Germany, 23% to 33% depending on the municipality (federal tax 15% + solidarity surcharge + municipal trade tax).
25% to 29%: Netherlands (25.8%), France, Belgium and Spain (25%), Luxembourg (24% to 28% depending on the municipality).
20% to 24%: Italy (24%, IRES only), Austria (23%), Denmark, Estonia, Greece and Slovenia (22%), Slovakia and Czechia (21%), Sweden (20.6%), Finland and Latvia (20%), Portugal (19% to 20.5% including the municipal surcharge).
Below 20%: Poland (19%), Croatia (18%), Lithuania (17%), Romania (16%), Cyprus and Ireland (12.5%), Bulgaria (10%), Hungary (9%).
The headline rate does not tell the whole story. Estonia and Latvia tax profits only when distributed; Ireland applies 12.5% to trading income but 25% to passive income; Malta refunds shareholders a large share of the tax paid by the company. Conversely, several low-tax countries have raised their rates in recent years under the pressure of the 15% global minimum tax (OECD Pillar Two).
France: 25% on paper, up to 36.1% for large groups
The standard corporate income tax rate has been 25% for financial years opened since 2022, at the end of the reduction path started in 2018. SMEs benefit from a reduced 15% rate on their first €42,500 of profit.
Two additional levies, left off the map because they only target large companies, nonetheless add to the bill:
the social contribution on profits of 3.3% (Article 235 ter ZC of the French Tax Code), payable by companies whose corporate tax exceeds €763,000, which brings the combined rate to 25.8%;
the exceptional contribution introduced by the 2025 Finance Act for groups with turnover of at least €1 billion, and extended for one year by the 2026 Finance Act with the threshold raised to €1.5 billion. For these groups, the effective rate reaches 36.1%, the highest in the European Union.
This instability is a cost in itself: a measure announced as one-off in 2025, renewed in 2026, and whose fate the 2027 Finance Bill will decide, complicates group planning and the way foreign investors read France.
Switzerland: 12% to 21% depending on the canton
In Switzerland, tax on profits is levied at three levels: the Confederation (8.5% of after-tax profit), the canton and the municipality. The combined effective rate therefore ranges from about 12% in Zug to 21% in Bern; Geneva and Vaud are around 14%, Zurich at 19.6%. Since the 2020 TRAF reform, privileged tax statuses have been replaced by targeted measures (patent box, R&D super-deduction), and since 2024 groups with turnover above €750 million are subject to the top-up tax that brings their effective rate to at least 15%.
For an SME or a service company, the gap with France remains substantial, around ten points. It must, however, be read together with French territoriality rules and controlled foreign company rules (Article 209 B of the French Tax Code), the risk of a permanent establishment in France and, for managers, the taxation of dividends on either side of the border.
What this means for businesses
The headline rate is not the effective rate. Research tax credit, 10% patent box, loss carry-forwards, tax consolidation: the rate actually borne by a French company is often well below 25%. Conversely, the 36.1% hits a handful of groups, not the fabric of SMEs and mid-caps.
Location is decided across the whole chain. Choosing Switzerland or Ireland for a corporate tax rate only makes sense if substance follows: effective management, staff, decisions. Otherwise the French tax authorities recharacterise, and the rate saving turns into a reassessment with penalties.
The global minimum tax reshuffles the deck. For groups with turnover above €750 million, the 15% floor applies throughout the Union and in Switzerland: tax competition shifts from rates to targeted incentives and administrative simplicity.
Succession planning starts with corporate tax. The level of tax on profits shapes the value of the business and its distribution policy; it interacts with the manager's personal taxation, inheritance tax and the preferential regimes on sale (Article 150-0 B ter, retiring manager's allowance).
Conclusion
At 25%, France stands in the European leading pack, four points above the EU average; at 36.1% for its largest groups, it tops the ranking. Neighbouring Switzerland, at 12% to 21% depending on the canton, shows how wide the gaps can be within a few kilometres. But the published rate is only one variable among others: tax base, tax credits, stability of the rules and substance of the establishment decide, far more than the rate itself, the real burden.
FAQ: corporate income tax in Europe
Does my company pay 25% or 25.8%?
25% for most companies. The 3.3% social contribution is only due if corporate tax exceeds €763,000, i.e. a profit of around €3 million. SMEs also benefit from the reduced 15% rate on their first €42,500 of profit.
Who is affected by the 36.1% rate?
Companies and groups with turnover of at least €1.5 billion in France, subject to the exceptional contribution extended by the 2026 Finance Act. SMEs and mid-caps are not concerned.
Why is Germany shown as a 23% to 33% range?
Because the trade tax (Gewerbesteuer), levied on profits, is set by each municipality through a multiplier. Added to the 15% federal tax and the solidarity surcharge, it leads to a combined rate of about 23% in the cheapest municipalities and 33% in the large cities; the national average is close to 30%.
Does a Swiss holding company secure Geneva's 14% rate?
Only if the company is actually managed there and has its own resources. A Swiss company whose decisions are taken from France is taxable in France on account of its place of effective management, and a holding company without substance may fall under Article 209 B of the French Tax Code. The rate advantage does not survive the absence of substance.
Does the 15% global minimum tax apply to my company?
Only to groups whose consolidated turnover reaches €750 million in two of the last four financial years. Below that, national rates apply without adjustment.
Eve d'Onorio di Méo
Lawyer, Certified Specialist in Tax Law
Marseille and Geneva Bars (EU/EFTA Lawyer)
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