Court Orders Bernard Arnault to Pay €22.5 Million in Taxes
Bernard Arnault and his wife must pay €22.5 million in back taxes after a Paris court ruled a Belgian holding company payout was taxable income.
A Paris administrative court of appeal ordered Bernard Arnault, CEO of LVMH, and his wife, Hélène Mercier-Arnault, to pay approximately €22.5 million in back taxes, social charges, and penalties. The July 2 ruling requires the couple to pay €12.96 million for contributions and interest related to 2010, and €9.5 million in wealth solidarity tax for the period between 2012 and 2015.
The dispute centers on a 2010 capital reduction of €32.18 million from Pilinvest, a Belgian holding company used to manage the family stake in LVMH. While Arnault argued the funds were a tax-free return of capital, French tax authorities contended the payment was taxable distributed income. To analyze the financial structure, the French government utilized assistance from Luxembourg and the Bahamas.
This decision reverses a 2020 judgment and two other previous court victories for Arnault. Following appeals by the French Ministry of Economy, the court upheld the state's assessment. A spokesperson for Arnault stated that the ruling will be appealed to the Council of State, the highest administrative court in France.
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