Canal+ has warned that a French government proposal to double value-added tax on television subscriptions would jeopardise the financing model that underpins the country's film industry, putting the future of French cinema at risk.
The plan, which would apply in mainland France, would raise VAT on pay-television subscriptions from its current reduced rate to the standard rate, effectively doubling the tax paid by subscribers. Canal+, the country's dominant pay-TV operator, argues that the measure would reduce subscriber numbers and, in turn, shrink the pool of revenue that flows into French film production.
Under France's long-standing media financing system, broadcasters and pay-TV operators are obliged to contribute a share of their turnover to domestic and European audiovisual production. Canal+ is one of the largest single contributors to French cinema, funding a significant proportion of films made in the country each year. The company says that if its subscription base declines because of higher prices caused by the tax increase, its mandatory contributions would fall accordingly.
The proposal has alarmed figures across the French creative sector, who see the levy as a direct threat to a funding ecosystem that has helped sustain one of Europe's most productive film industries. France produces more films per year than almost any other European country, and its cinema is widely regarded as a cultural asset that relies on a combination of public subsidies, broadcaster levies and private investment.
Canal+ has been vocal in opposing the measure, arguing that it would penalise a business that has been a reliable partner to the film industry for decades. The company contends that the government has not adequately assessed the knock-on effects on production budgets, employment in the sector or the wider cultural economy.
The dispute comes at a delicate moment for French media. Streaming platforms have reshaped viewing habits, traditional broadcasters face intensifying competition and production costs have risen sharply. Any reduction in Canal+'s contribution would be felt across the industry, from production companies and studios to technicians, actors and directors who depend on a steady pipeline of domestically financed projects.
Supporters of the tax change argue that it would close a gap between pay-TV and other services, and that the reduced rate has long given subscription television a tax advantage. But critics say the timing is poor and that the measure risks undermining the very industry it is meant to support, because the money raised would not necessarily be redirected into film financing.
The outcome of the debate will be closely watched beyond France. Other European countries operate similar levy systems designed to channel broadcaster revenue into local production, and a French retreat from that model could set a precedent. For now, Canal+ and its allies in the film sector are pressing the government to reconsider, warning that the consequences for French cinema would be felt for years to come.