On December 31, 2009, the French government published changes to its business tax law known as “Taxe Professionnelle”. The business tax been replaced with two new taxes:

• “Contribution fonciere des enterprises” or “CFE” and
• “Cotisation sur la valuer ajoutee des enterprises” or “CVAE”

The business tax had historically been treated as a non-income tax, however, given the change in tax law the CVAE is now generally considered an income tax and therefore should be accounted for in accordance with ASC 740 or IAS 12. Furthermore, only certain elements of income and expense are included in the calculation of the CVAE and therefore not all basis differences will necessarily give rise to a deferred tax asset or liability.  As such, refer to 740-10-30 (Q&A 23) for guidance on the recognition and measurement of basis differences in adjusted gross receipts tax regimes. The CFE continues to be accounted for as a non-income tax. For purposes of US GAAP the changes are considered enacted on December 31, 2009, and therefore any impact of these changes should be recorded in the period that includes this date.