Driving in France

(source: European Union)

Information on community law

As a general rule, your vehicle should be registered and taxed in the country where you have your normal residence.

1. VAT

The VAT rules which apply when a vehicle is acquired in one EU Member State and is intended to be registered and used in another Member State are as follows:

• If you buy a new car, you must pay VAT in the country of destination, i.e. the country where the car is to be registered. This means that the price you pay for a new vehicle bought in a Member State other than the Member State of destination will not include VAT. A car bought in another Member State is considered to be new if it is less than six months old or has travelled less than 6 000 km. 
• If you purchase a second-hand car (i.e. a car which is more than six months old and has travelled more than 6 000 km), VAT is payable in the country of purchase.

For rates of VAT (%) applied in the Member States and Accession countries see the Europa Taxation & Customs Union website

In any event, since 1 January 1993 the Member State of destination no longer has the right to levy VAT on personal effects introduced from another Member State by an individual transferring his normal residence. This applies also to vehicles.

2. Other taxes 

Member States are entitled to levy taxes other than VAT on vehicles provided, however, that those taxes do not give rise to border-crossing formalities in trade between Member States.

Member States may grant exemptions if the vehicle is transferred from one Member State to another as a result of the transfer of the owner's normal residence.

The Commission has prepared a notice for citizens setting out the tax consequences of transferring cars across borders. It addresses only the cross-border aspects of car taxation. Cars are an important means of getting around and, therefore, of exercising the right of freedom of movement their users are guaranteed under the EC Treaty. Many citizens take the car when they leave their Member State temporarily or settle permanently in another Member State. Others buy or hire a car in a Member State other than their own.

The Commission has also presented a comprehensive strategy on the taxation of passenger cars in the European Union. First, the Commission analyses current passenger car taxation systems and explores ways of improving their co-ordination so as to remove the present considerable tax obstacles and distortions to free movement of passenger cars within the Internal Market. Registration taxes are identified as the biggest problem and therefore the Commission recommends their gradual reduction and even abolition, to be replaced by annual road taxes and fuel taxes (so that the tax burden would remain the same but related to the use of a car rather than its acquisition).

• For further information see the Europa Taxation and Customs website.
• See information on individual Member States' tax authorities on the Europa Taxation and Customs website

Note: This Citizens First Factsheet is intended to provide guidance on EU law for information purposes only. It has been prepared by the European Commission with the help of national authorities and contains information on the national implementation of EU law. You are advised that the texts of Community legal instruments should be relied upon in case of doubt concerning the extent of a right or obligation arising from EU law.