Foreign owners of French holiday homes are to be slapped with a 20% tax, which could lead to a rise in the cost of self-catering holidays in France.
The tax, to be introduced by President Nicolas Sarkozy next January, will be levied on the estimated annual rent a property could generate, whether or not it is actually rented and regardless of the actual income.
Some of the 360,000 non-resident owners of holiday homes in France, including 200,000 Britons, are expected to sell their properties as a result of the new tax, according to reports in the Telegraph.
This could lead to a shortage of holiday accommodation and an increase in prices of cottages, gites, villas, holiday flats and ski apartments, although there are suggestions it could be challenged in the European courts on the grounds that it discriminates against foreign owners of holiday homes.
By Linsey McNeill
