The government wants to double VAT on pay television, Canal+ threatens to reduce its investments

The government wants to double the VAT rate which applies to pay television, according to the finance bill presented on Thursday, to the great fury of Canal+, which threatens to reduce its investments in cinema and sport. Such an increase, from 10% to 20%, would be “a direct attack on the activities” of Canal+ in France, “its historic market”, thundered in a press release the audiovisual group, the leading financier of French cinema.

The loss could reach “200 million euros per year”, with “a certain impact on the price of its subscriptions, its workforce, and its financial contributions to the ecosystem of cinema and sport”, a prospect which makes these two sectors tremble. If this increase is ratified by Parliament, Canal+ “will draw the consequences and accelerate its international deployment strategy,” he threatened.

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Currently, subscriptions to traditional pay television, that is to say which broadcast their programs in real time, benefit from a reduced VAT rate of 10%. The rate for platforms whose model is built on on-demand programs (Netflix, etc.) is 20%. Canal+ offers both types of service, and the reduced rate of 10% applies to most of its activities. The 2027 finance bill plans to “simplify the VAT regime applicable” to pay television by removing the reduced rate. Canal+ would be the main operator affected.

Also read Why a possible increase in VAT on Canal+ scares French cinema and sport

“Dramatic consequences”

“The current framework appears to be complex in application”, in “a context marked by the development of composite subscription offers” (classic television and on demand), is written in the explanatory statement of the reasons for this measure. The question of the reduced VAT rate had already been the origin of a long dispute between Canal+ and the tax authorities, which ended in 2025, with the group agreeing to pay 363 million euros.

Before its formalization on Thursday, the hypothesis of a VAT increase had already raised concerns. Thirteen film organizations wrote to Emmanuel Macron on September 25 to express alarm at the “dramatic consequences” of such a measure. This “could significantly affect the economic balance of [the] activity in France [of Canal+] and, consequently, its capacity to invest in cinematographic creation”, worried the signatories.

At the end of July, Canal+ committed to investing 980 million euros between 2028 and 2032 in French and European cinema, under the terms of an agreement with the sector. There is also great concern in the rugby world, of which Canal+ is the broadcaster. “It is obvious that if our main financial support (...) was in trouble, the entire chain would be impacted,” declared Yann Roubert, president of the National Rugby League (LNR), Monday on the sidelines of rugby night.

Also read: French professional sport asks Emmanuel Macron to abandon the plan to double VAT for pay television

Sport trembles

In addition to Canal+, other audiovisual players broadcasting sport for a fee are also affected by the VAT increase. Among them, Ligue 1+, the platform of the Professional Football League (LFP), broadcaster of the French championship. This increase would have “significant repercussions on the economic balance of the broadcasting of French professional football, as well as on the entire value chain which depends on it,” warned Olivier Bramly, general manager of LFP Media, commercial subsidiary of the LFP, in a letter to the government dated Tuesday.

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In a separate letter to Emmanuel Macron, the ANLSP association, which brings together the six professional sports leagues (football, rugby, cycling, handball, basketball and volleyball), expressed its “deep concern”. “Such a measure would weaken an essential pillar of sports financing,” these leagues fear.