A cornerstone of business succession in France, the Dutreil Pact has, over the years, established itself as one of the most powerful tax tools available to business leaders and family shareholders.
However, in a context of budgetary pressure and scrutiny of tax loopholes, the mechanism is now under the authorities’ watchful eye. The 2026 Finance Act marks the first tightening.
Analysis and explanations by the experts at AURIS Finance, a consultancy specializing in mergers and acquisitions.
The Dutreil Pact in Brief
Introduced by the law of the same name in 2003, the Dutreil Pact is a measure that reduces the tax cost of business succession through an exemption, decreasing the taxable base by 75% of the company’s value.
This exemption comes with conditions requiring the acquirer to hold onto the business for a minimum of four years. At the end of this period, the heir can sell the business with a significant capital gain.
A Measure Considered Too Costly Tax-Wise
This mechanism, which applies equally to a small neighborhood shop or a very large company, is often criticized. It is considered too broad and insufficiently targeted, resulting in a real loss of revenue for public finances. A recent report from the Cour des comptes estimates the cost of the measure at €5.5 billion in 2024, ten times higher than the amount previously cited by Bercy. Worse, the fiscal shortfall has grown over the years: €1.2 billion in 2020, €2 billion in 2021, and €3.3 billion in 2023.
2026 Finance Act: Tightening Measures
In this context, the 2026 Finance Act brings several changes to the Dutreil Pact. All aim to limit short-term wealth strategies and refocus the measure on operational assets directly linked to economic activity.
- The minimum holding period is increased from four to six years.
- Certain assets are removed from the scope of the exemption. So-called “luxury” assets — cars, commercial vehicles, residences not used for professional purposes, jewelry, art objects, and precious metals — will no longer benefit from the tax advantage.
Towards Further Reductions?
While the 2026 Finance Act has tightened the Dutreil Pact, it does not alter its overall framework but leaves the door open for future targeted reductions. The Cour des comptes suggests several avenues:
- Capping the tax benefit for very large successions.
- Stricter conditions when the succession is not accompanied by a real commitment to the company’s management.
Conversely, employers’ organizations emphasize that the Dutreil Pact remains a pillar of economic sovereignty, allowing thousands of SMEs and mid-sized companies to be passed on without falling under foreign control — an argument in favor of calibrated adjustments rather than complete dismantling.
Anticipating Executive Taxation
The evolution of the Dutreil Pact under the 2026 Finance Act marks a significant turning point for business leaders. For several years, the tax authorities have been strengthening their oversight of compliance with holding commitments and the nature of eligible assets.
Structures aimed purely at wealth management are now closely scrutinized. In this context, anticipation becomes a strategic lever: it involves assessing the tools that can optimize the tax burden while respecting the spirit of the measure.
Our Experts by Your Side
The teams at AURIS Finance support executives at every stage of the process: analysis of professional assets, legal safeguarding of the structure, anticipation of upcoming legislative and fiscal changes. Our experts guide you through the succession of your business.
