Family Holdings: The State Versus Long-Term Strategy

A "dormant rent" that funds the economy

Behind the technocratic formula lies a proposal with significant implications: treating undistributed profits of holding companies as realized and thus taxable income. This is considered a tax fiction by practitioners, akin to taxing resources still invested in growth.

"Holding onto cash in the long term is not inaction; it’s sound and responsible management, » says Charles-Henri Bujard, president of AFFO. These reserves allow companies to cushion crises, fund subsidiaries, support employment, and avoid rushed sales in succession scenarios. In an uncertain economic environment, cash represents patient capital that maintains the stability of family businesses.

According to AFFO, this measure could undermine the financial strength of groups and weaken intergenerational transfers. « A holding company is the network's core, not a safe, » explains an industry professional. By confusing caution with unearned income, the State targets one of the pillars of economic sovereignty: the capability of families to invest long-term.

The Invisible Pillar of French Capitalism

In France, family holding companies ensure the sustainability of thousands of SMEs and mid-sized businesses. They finance innovation, external growth, and the energy transition. During times of crisis, they serve as a foundation: they maintain employment, support the cash flow of subsidiaries, and cushion cyclical shocks. Their role goes beyond asset management to become economic and social.

The AFFO emphasizes that this new taxation would trigger a domino effect: a decrease in equity, a reduction in investment capacity, and an increase in the cost of capital. « Taxing holdings means condemning what allows them to protect jobs, invest, and prepare for the future, » stresses Charles-Henri Bujard. Ultimately, the risk is clear: pushing some families to relocate their head structures, leading to an erosion of the French entrepreneurial fabric.

This initiative runs counter to the government's stated goals of reindustrialization and economic sovereignty. While the executive seeks to attract foreign investors, it sends a paradoxical signal to those in France who practice patient capital. The debate goes beyond taxation: it questions the very vision of long-term planning in an economy that favors immediate spending.

The Invisible Pillar of French Capitalism

In France, family holdings ensure the longevity of thousands of small and medium-sized enterprises (SMEs) and intermediate-sized enterprises (ETIs). They finance innovation, external growth, and the energy transition. During times of crisis, they act as a foundation: they maintain employment, support the cash flow of subsidiaries, and cushion economic shocks. Their role extends beyond asset management to become both economic and social.

The AFFO emphasizes that this new taxation would trigger a domino effect: a decrease in equity, a decline in investment capacity, and an increase in the cost of capital. « Taxing holdings condemns what allows them to protect jobs, invest, and prepare for the future, » stresses Charles-Henri Bujard. Ultimately, the risk is clear: driving some families to relocate their head structures, leading to an erosion of the French entrepreneurial fabric.

This initiative runs counter to the government's stated objectives of reindustrialization and economic sovereignty. While the administration seeks to attract foreign investors, it sends a paradoxical message to those in France who practice patient capital. The debate goes beyond taxation: it questions the very concept of long-term vision in an economy that favors immediate spending.