In a decision (no.94-1449) dated December 28, 1995, the Nancy administrative court of appeal ruled that capital gains resulting from the sale of securities provided for under Article 92 B of the French Tax Code (FTC) are not included in the net income subject to personal income tax against which any industrial or commercial loss may be offset. A taxpayer had sold a large amount of securities, treated under Article 92 B of the FTC as non-commercial profits and taxed at the flat rate of 16% in accordance with Article 200 A of the FTC. He considered that he was justified in setting off his industrial or commercial losses against these gains. The Court rejected this compensation and ruled that the fact that tax was applied at a fixed rate to the capital gains concerned made them independent of the taxable base for income tax to which a progressive rate is applied.

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