Orange Challenges Tax Measures Over VAT Dispute and Recovery

Orange Challenges Tax Measures Over VAT Dispute

In a significant move, Orange is contesting the measures enacted by the National Financial Prosecutor's Office (PNF) concerning an ongoing value-added tax (VAT) allocation dispute. This dispute arises from VAT rates applied to promotional offers marketed by the telecommunications giant, primarily during the years spanning 2017 to 2019. The company has taken a firm stand against the allegations and the recovery measures instituted by the PNF.

Details of the Seizure and Orange's Response

On October 7, 2024, the PNF ordered the seizure of a staggering 312 million euros from Orange to recover purported unpaid taxes. This substantial amount has been placed with the French public financial institution Caisse des dépôts et consignations, making it inaccessible to Orange while the dispute unfolds. Notably, this seizure will be reflected in the Group's financial statements as of December 31, 2024. However, it is essential to highlight that this action does not alter the company's robust financial projections.

Orange’s Financial Position Remains Strong

Despite the challenges posed by this tax dispute, Orange maintains confidence in its financial stability. As of June 30, 2024, the company reported a consolidated balance sheet totaling 104.4 billion euros, along with a healthy cash position of 17.4 billion euros allocated for its telecommunications activities. Additionally, Orange remains a key player in the telecommunications sector, listed on the Euronext Paris stock exchange under the ticker symbol ORA. Furthermore, the French government holds a significant share of 22.95% in the company's capital.

Cooperation and Commitment to Transparency

Orange has expressed its commitment to full cooperation with the PNF during this preliminary investigation phase. The Group is focused on clarifying any issues regarding the documentation involved in the investigation, which underscores its transparency and dedication to compliance.

About Orange

Orange stands out as one of the leading telecommunications operators globally, recording revenues of 39.7 billion euros in 2023 and employing approximately 128,000 individuals worldwide as of September 30, 2024. Within France, the Group employs around 71,000 people and caters to a vast customer base of 292 million globally, which includes 253 million mobile customers and 22 million fixed broadband subscribers. These customer figures have been adjusted due to the deconsolidation of specific activities in Spain following the launch of MASORANGE.

Strategic Vision for the Future

In February 2023, Orange unveiled its ambitious strategic plan, "Lead the Future." This initiative focuses on creating a more innovative business model that emphasizes responsibility and efficiency while leveraging network excellence to enhance service quality. The strategic outlook aims to solidify Orange's position as a leader in the telecommunications sector.

Press Contacts

For inquiries, please contact:
Tom Wright
Email: tom.wright@orange.com

Frequently Asked Questions

What is the VAT allocation dispute involving Orange?

The dispute pertains to VAT rates applied to promotional offers by Orange between 2017 and 2019, which the PNF is investigating.

What was the amount seized by the PNF?

The PNF ordered a seizure of 312 million euros from Orange to recover alleged unpaid taxes.

How does this seizure affect Orange’s financial position?

Despite the seizure, Orange maintains a strong financial position with a balance sheet of 104.4 billion euros and a cash reserve of 17.4 billion euros.

What steps is Orange taking in response to the investigation?

Orange is fully cooperating with the PNF, focusing on transparency and clarifying documentary issues related to the investigation.

What does the future hold for Orange?

Orange's strategic plan, "Lead the Future," aims to enhance its leadership in service quality through responsibility and network excellence.

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