While the French government is preparing the budget in 2026, the discussion about reducing the tax credits is again up to date. This also includes the research tax credit (CIR). A reduction in the CIR could have a significant impact on companies in the fashion and sports industry: for example on decathlon. The French sporter has already expressed his concern in this regard.
According to a document by the French authority for transparency in public life (HATVP) of March 21st, Decathlon turned to parliamentary members. The company warned of the consequences of a reduction in the research tax credit. Decathlon stated that this reduction would impair “the innovation ecosystem in France and the competitiveness of French companies”.
What is the CIR?
In France, the research tax credit (CIR) is to “encourage companies to carry out research and development activities (F&E),” says the State website Entreprise.service-Public. This tax regulation enables companies to deduct part of their expenses for research and development (F&E) from their corporate tax. The sentence of the research tax credit varies depending on the amount of the expenditure. It is 30 percent for the part of the expenditure up to 100 million euros and five percent for expenses. The CIR thus represents considerable financial support for companies such as decathlon who have made innovation a cornerstone of their business model.
Innovation has been the focus of the corporate strategy since Decathlon was founded in 1976. The company is characterized by the development of its own brands and new products that it presents every year as part of an event called ‘Reveal Innovation’.
The CIR supports these efforts by reducing the financial risks related to research. In view of the continuous investments of decathlon in research and development, it is very likely that the company is an important benefit of this credit. By warns by decathlon of the consequences of a reduction in the CIR, the company wants to receive a favorable tax environment. This continues to enable the company to invest in new technologies and materials.
In addition, Decathlon also mentions the ‘innovation ecosystem in France’ and thus underlines the mutual dependence of the economic actor: inside. A reduction in the CIR could weaken the entire value chain of the innovation and have an impact on start-ups, small and medium-sized companies (SMEs), research laboratories and partnerships. For a group like Decathlon, a dynamic ecosystem is essential to win talents, work with innovative partners and to gain access to new technologies. This has been all the more valued since the group launched the investment company called Decathlon Pulse, the aim of which is to develop ideas and concepts with ‘strong potential’.
In 2024, the decathlon group recorded sales growth of 5.2 percent compared to 2023. The turnover amounted to 16.2 billion euros.
According to a contribution by the French newspaper Le Monde, the research tax credit is the largest tax expense of the state for companies and its amount is steadily increasing. In 2024 it amounted to 7.6 billion euros, which is about ten percent of corporate tax.
This article was used with digital tools translated.
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