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Rate of Tax:

7 percent, except for the first 10,000 francs of

taxable income on which the tax is 3.50 percent.


Persons Liable. All persons or companies engaged in industry, commerce, et cetera, unless special measures are taken by the person or company to force technical instructions and apprenticeship, in which total or partial exemption may be granted.

Deductions Allowed: Total or partial exemption may be granted from this tax under certain conditions--see above under Persons Liable. Rate of Tax: 0.2 percent of salaries paid.


Persons Liable:

Retail establishments, banks, credit establishments, insurance companies, savings companies, when the annual turnover is in excess of 1,000,000 francs.

Deductions Allowed: First 1,000,000 francs' turnover.

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Persons Liable: Corporations and Limited Liability Companies. Deductions Allowed: None.

Rate of Tax: 4 percent (6 percent for companies holding concessions for the exploitations of public services). The amount taxed is the declared profits for the tax on industrial and commercial profits and the amount of dividends distributed.


Persons Liable: All persons receiving income from but tax is paid at the source of the income.

Deductions Allowed: None.

this source,

Rate of Tax: As the 8 percent increase applied to all of these taxes included in this report has been "rounded" out for this tax, both the base rate and the rate including the 8 percent increase are given:

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Persons Liable:

Corporations, partnerships with a share capital, departments, communities, and in general to all legal persons possessing property which, by the nature of the ownership, does not become subject to death duties nor normally to the taxes assessed on the sale or transfer of property.

Deductions Allowed: None, but simple partnerships, companies buying and selling real estate, companies building and selling lowcost dwellings, and artisan cooperatives are exempt. (This exemption does not extend to property in the hands of real estate companies and companies building and selling low-cost dwellings, if such property is not for sale but is used for normal business purposes.) Rate of Tax: 18 percent of the income as calculated for the real estate tax. 9 percent for property of departments, communities, charitable organizations, low-cost dwelling companies, et cetera.

Persons Liable:


Holders of Mining concessions, holders of mining permits, prospectors for petroleum and natural gas.

Deductions Allowed: Holders of concessions for fuel mines of an area of less than 300 hectares and with a net income of not over 1,500 francs are exempt unless they have not been worked for 10 years. Rate of Tax:

Ordinary concessions: 1.20 francs per hectare (6.50 francs per hectare if the mine has not been worked for 10 years).

Permits for working mines: 1.30 francs per hectare.

Exclusive permit to prospect for petroleum or natural gas: 4.00 francs per hectare.



Persons Liable: Only such persons as profit from such trans


Rate of Tax: 36 percent.



Persons Liable: Only such persons as profit from such transactions. (Such transactions include not only business transactions with government administrations, departments, and cities, but also with certain public utility companies operating under concessions.) Rate of Tax: 10 percent.


Persons Liable: All corporations or limited liability companies in France which have been in existence for five years as of January 1, 1936.

Deductions Allowed: Legal reserves and justified amortizations. Amount of Tax: 2 percent of reserves in existence at the end of the fiscal year closing in 1935 (3 percent for companies holding

concessions for public services). The tax was applied by law of December 31, 1936, and the tax was collected in 1937. It has been replaced by the annual tax on non-distributed profits.

The above brief summaries describe the taxes collected to the profit of the State in France. The State also receives an important share of the real estate taxes (on built and unbuilt property), but it is impossible to estimate even approximately the amount of these taxes, as they vary greatly according to locality. The administration of Direct Taxation has attempted to work out a plan where the amount of the real estate taxes, including the shares of departments and communities, could not exceed one-third of rental values, but such a plan was found to be impractical. The present practice is for departments and communities to submit their needs for income from these taxes to the Administration in the form of "additional" centimes to the base tax, the Administration either approves or suggests revisions.

With regard to the "patente", already described very broadly on the last page of the article proper, it is of interest to note how widely the coefficient of increase of the base tax rates--which in themselves vary widely according to locality--varies in some of the larger French cities, as follows:

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With regard to the "Assimilated" direct taxes collected for the most part on behalf of the communities, these not only vary greatly, but most communes do not apply all the taxes authorized by law.

While it is impossible to describe in detail the various direct taxes assessed in France on behalf of departments and communities, it should be noted that over 40 percent of all direct taxes collected in France go to meet the cost of departmental and communal government, and these local governments hence play an important role in the total direct tax burden of the country.

"American Hardwood Flooring and Its Uses," T.P.S. No. 186, is the latest in a series of trade promotion bulletins on American forest products. Included in the description of hardwood, its adaptability to different types of flooring and its care, are many attractive cuts giving visual evidence of the beauties of this product. The pamphlet is available from the office of the Superintendent of Documents, Washington, D. C., at 10 cents per copy.



By Commercial Attache Julian B. Foster, Copenhagen

Two interesting examples of social legislative acts that have recently created considerable comment among the business communities of Denmark are the Danish employee law assisting the white collar worker and the vacation law. Both of these acts favor the employee and seem to tend to make it more difficult for the employers in numerous ways. It has been contended by some employers that as a result of the vacation law their operating costs will be increased by some 4 to 5 percent. Under the terms of the new employee law it now becomes obligatory after an employee has been with a firm for three and one-half years for the employer to give him six months' notice of intended dismissal. The fact that the employer may be losing money steadily on his business or be undergoing serious business difficulties does not alter the case in any degree and he is compelled by the law to continue the services of the employee whether he needs him or not. This law has been severely criticized by the employers but to no avail. The vacation law became effective July 1, 1938 and the employee law became effective November 1, 1938.


The purpose of the vacation law is to establish minimum vacations with pay for laborers and employees and to make the conditions applying to agreements on this subject previously passed between employers on the one side and laborers and employees on the other side more uniform. Generally speaking, all laborers already had succeeded in obtaining vacations with pay by means of their own power as executed through their trade unions previous to the passage of the law and had had these rights vested in their agreements with the employers. Other groups such as apprentices, servants and government employees had had their vacation problems settled by the legislative power and had had their rights vested in special bills. The new law, therefore, does not include any of these groups of laborers or employees nor does it include the large group of employees who have accepted voluntarily such leave as their employers have granted them except in cases where the rights of these people are found to be inferior to the privileges stipulated in the law.

Briefly the law sets forth that all employees shall be entitled to vacation with pay based on one day for each month of work or service or to twelve consecutive working days within a year. The vacation which must be taken shall be granted the employee or laborer within the period extending from May 2 through September 30, of the working year.

Generally the question of leave in the case of laborers will be arranged in such a way that the workers on each pay day receive 4 percent of their pay in the form of a certain type of stamp. The stamps can be bought by the employer at the mail offices. The workers keep the stamps until they have earned their vacation and then convert them into cash at the mail offices. The stamps must not be transferred, negotiated or be made subject to sale in any form.

The effects of the law are expected to be numerous and important.

Trade Union workers, generally speaking, already had obtained one week's vacation with pay per annum and the new law thus will increase their vacation period by 100 percent. For other employees it will be of minor effect or no effect at all because most of these already obtain a fortnights' leave per annum as a minimum.

Protests against the law have been strongest from agriculture and the manufacturing industries. Beginning next year a number of the manufacturers will close their plants for a fortnight during the summer in order that all of their laborers and employees may take their leave simultaneously.

Such procedure may have a decided adverse economic effect in districts where shops and traders base their living on sales to the establishments involved. On the other hand the transportation and tourist industries are expected to benefit. It has been maintained that the manufacturers and producers may find no other way to compensate their increased costs resulting from the law, but to pass these on to the consumers in the form of higher prices with smaller consumption, reduced turnover, and increased unemployment as the ultimate results.


The employee law deals with the relationship between employers and employees. It sets forth minimum conditions and rights of the employees such as referring to notice of discontinuation of services; pay in case of illness or absence from duty on account of temporary military conscription; pay to dependents in the case of the death of the employees; the rights for employees to organize themselves and collective bargaining relative to wages and working conditions.

The law does not include the manual laborers who generally have had their conditions settled through their trade unions with their employers. The employee law, therefore, is confined to the "white collar workers as it was felt by the government that the status of these ought to be improved.

The bill is considered of smaller economic significance than is the vacation law partly because it excludes the large group of manual laborers and partly because it grants no more rights to the employees than the great majority of these already had been granted voluntarily in the past by their employers. Exceptions, however, are the longer term of notice which is now to be six months after three and one-half years of service as against three months previously and the right now given to the employees to organize themselves and negotiate wage and working problems with the management. This new privilege is not supposed to be of any great practical importance as long as the white collar workers constitute one of the least unionized groups of the laboring population in this country which is otherwise very strongly organized; and the government's efforts and encouragements to facilitate a stronger organization of this group so far have made very little progress.

Most Danish financial, commercial and industrial enterprises of significance in the past have offered their employees concessions which are superior to those set forth in the law and it is, therefore, expected to be felt mostly within part of the retail trade and by some of the smaller industrial and commercial outfits.

An outstanding feature of the law is that the benefits and rights of the employees shall be determined by their length of service. It has been stated that a few employers will attempt to dodge it by

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