Important
Amendments I-CF742, I-CF1812, and I-CF656 achieved consensus among members during the interim votes in the Finance Committee, marking a convergence on several key points of the text. However, on the night of October 22 to 23, the committee members rejected the first part of the 2026 finance bill.. Since the afternoon of October 24, the National Assembly has been meeting in public session to study, amend, and debate the 2026 Finance Bill. The version currently under review is the one initially presented by the Lecornu administration.
All of this is subject to change as discussions progress, and we will keep you informed of any upcoming changes and developments.
The 2026 Finance Bill initiates a structural transformation of the CIR, CII, and JEI statutes, placing social and environmental responsibility at the heart of French innovation policy.
An ambitious reform of the 2026 draft finance bill for innovation taxation
Submitted on October 14, 2025, by the Lecornu II government, the 2026 Finance Bill did not originally include, that a minor adjustment to the Young Innovative Companies (JEI) scheme, aiming to increase the minimum share of R&D expenditure in total expenses from 20% to 25%.
However, the parliamentary amendments registered up to October 20, 2025 reflect a much broader ambition: that of a fundamental overhaul of the taxation of innovation. The scope of the proposals now extends to the Research Tax Credit (CIR), the Innovation Tax Credit (CII), the Research Collaboration Tax Credit (CICO), and the creation of new statuses for innovative companies.
JEIR, JEII, CII-IA, and CICo: toward new tax incentives for innovation
The 2026 draft budget also includes proposals for new measures:
- I-CF1812 : creation of the Young Innovative Impact Company (JEII), combining technological innovation and social performance, with a 40% tax exemption on capital subscriptions until December 31, 2028 (IR-PME or Madelin scheme)
- I-CF1483 : creation of the Breakaway JEI, open to companies less than 12 years old that devote at least 30% of their expenses to research, and benefiting from the same tax and social security incentives as existing JEIs; ;
- I-CF1500 : creation of a Innovation Tax Credit – Artificial Intelligence (CII-IA), including high-performance computing expenses (GPU, CPU); ;
- I-CF927 : extension of Research Collaboration Tax Credit (CICo) until December 31, 2028, in order to maintain public-private partnerships.
Refocusing the Research Tax Credit on high-impact projects
Alignment of the CIR with environmental and social objectives
A first series of amendments aims to align the CIR with ecological and social transition objectives.
- I-CF742 : prohibition on transferring abroad, for a period of ten years, activities resulting from projects that have benefited from the CIR.
- I-CF743 : limiting the benefit of the CIR to social and solidarity economy (SSE) enterprises whose work addresses unmet social or environmental needs.
- I-CF745 : refocusing on medical, social, and environmental research, excluding gas and nuclear energy.
- I-CF1123 Modulation of the CIR (30–60 %) and CII (30–70 %) rates according to where the expenditure is incurred and its contribution to European environmental objectives.
Social conditionality and CIR caps: stricter criteria
Lawmakers are also proposing to link the benefit of CIR to economic, social, and territorial commitments.
- I-CF698 and I-CF700 : prohibition on transferring activities abroad for ten years; in the event of a decrease in R&D personnel expenses over two fiscal years, full repayment of the credit plus a 100% penalty.
- I-CF729 : regulation of dividend distributions and redundancies, with a penalty equivalent to the credit received + 10% of the amount of the credit.
On the financial front, several amendments (including I-CF685, I-CF687, I-CF744, I-CF661) modify the structure of the device:
- Ceiling on eligible expenses at the 30% rate lowered from €20 million to €100 million, with elimination of the reduced 5% rate above this threshold; ;
- Overall ceiling per group set at €350 million; ;
- Progressive scale based on R&D intensity/revenue: 15% (5%). ;
- Exclusion of companies with turnover exceeding €100 million, assessed at the consolidated group level (I-CF744 and I-CF745).
Review of the scope and refocusing of the CIR scheme
The amendments I-CF747, I-CF683, I-CF689, and I-CF693 propose to assess the CIR at group level when the parent company holds more than 50% of the capital.
Other measures aim to clarify the basis for calculation:
- I-CF842 and I-CF643 : reinstatement of patent defense and maintenance costs, elimination of operating costs and depreciation allowances for buildings; ;
- I-CF838 : limitation of subcontracting to €1 million (if related party) and €5 million in total; ;
- I-CF19 and I-CF1508 : exclusion of credit institutions and finance companies from the scheme.
Furthermore, restoring the consideration of expenses related to young doctors was not proposed by parliamentarians.
Conclusion: a more sustainable and localized taxation system for innovation
Parliamentary discussions on the 2026 budget bill mark a significant shift in the philosophy of fiscal support for research and innovation. They reflect the desire to balancing budgetary constraints, social responsibility, and technological sovereignty.
The CIR version 2026 could thus evolve from a simple competitiveness tool to a genuine lever for sustainable, localized innovation., placing research taxation within the European objectives of ecological transition and reindustrialization.
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Article written by:
Alex PROUVEUR – Tax Lawyer at G.A.C. Group
Alex holds a master's degree in tax law from the Catholic University of Lille and a specialized master's degree in business management from Skema Business School, specializing first in local taxation and then in innovation taxation. At G.A.C Group, he brings his expertise to innovative companies through constant monitoring of legislation and case law, and assists them when they are faced with audits by the tax authorities.
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