Guesthouse owners across France say changes to taxation and energy check rules could force them to shut, causing serious harm to rural tourism.
Bed and breakfast operators have raised the alarm over government plans they say risk undermining the financial viability of their businesses.
Among the changes already in force or planned are changes this year for income thresholds and deductible expenses, a potential drop in the VAT exemption threshold, and stricter energy-efficiency rules expected to bar many traditional properties from being let out.
Proposals to lower the VAT exemption threshold for small businesses to €25,000 are being debated by the government and a decision is expected in June.
The current threshold is €85,000 for chambres d’hôtes run under the micro-Bic (‘micro-entrepreneur’) system. Once that limit is reached, owners would have to start charging VAT to guests at 10%.
The alternativeréel accounting system, involving claiming ‘real’ expenses with supporting paperwork, is more complex and requires an accountant (and also involves charging VAT).
The change to VAT thresholds had originally been set for inclusion in the 2025 budget, but has now been delayed following backlash from professional federations and several politicians, including former prime minister Gabriel Attal. However, it remains unclear whether the proposal will be dropped.
It comes as changes are now also in force for the threshold to maintain the micro-Bic status (as opposed the réel) and to its fixed expenses allowance: down to €77,700 and 50%, from €188,700 and 71% previously.
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The rules for those letting out furnished accommodation other than chambres d’hôtes are now even more strictly limited, unless the accommodation has been classified with a star rating.
‘It’s death by a thousand cuts’
One B&B owner in the Loire Valley told The Connexion that the changes would place immense strain on already slim profit margins.
“I’ve lost a huge amount of my tax allowance. Out of every €100 I earn, 71% goes on taxes, gas, water, electricity, washing, sheets, new mattresses, breakages. The upkeep of a B&B costs a lot of money,” they said.
The changes to the thresholds and allowances were part of wider efforts to tackle the housing shortage, but they have hit hospitality providers hard.
Running costs are also on the rise. The price of energy and food – particularly breakfast staples such as orange juice and coffee – continues to increase, with some items expected to rise by a further 15% in the coming weeks. There have, meanwhile, been warnings of further electricity rises to come this summer, linked to changes in the way VAT is levied on bills.
“Prices have gone up 34% in the past four years on breakfast items,” the owner added. “I make my bread, my croissants, a lot of my food. They don’t take that into account.”
Owners fear a 10% loss on advance bookings next year as a result of the uncertainty, coupled with the wider cost-of-living crisis in France.
Energy regulations ‘a ticking time bomb’
Another headache is looming in the form of stricter energy performance rules. Properties rated E, F or G on diagnostic de performance énergétique (DPE) checks will no longer be allowed to operate as B&Bs unless they are upgraded – something that could prove impossible for many period buildings.
By 2033, all rental properties must achieve at least an ‘E’ rating, rising to ‘D’ by 2034. Local authorities will be given the power to request a DPE certificate and impose fines if one is not provided.
“My colleagues are saying, ‘We’ve got a great big mansion with beautiful old windows. We can’t insulate it. How do we do it?’ In a year we won’t be able to rent our rooms out,” one owner said.
Faced with rising costs and falling margins, many owners are now reconsidering their future. Some are weighing up early retirement, while others are calling for the reforms to apply only to new businesses, with older or near-retirement operators allowed to continue under existing rules.
“Normally in France, you get time to prepare and adapt. This time they’re giving us nothing. They’re giving us a rope to hang ourselves with,” one B&B operator said.
Dominique Coudray says rural communities will be hitDominique Coudray
Dominique Coudray, who has run La Maison des Autres in Saint-Geniès-de-Malgoirès in Gard since 2020, said the reforms could have “serious social consequences”.
“The new tax measures proposed by the government will result in the outright closure of many French guesthouses, particularly in rural areas where hotels are rare,” she said. “We support local economies – I tell my guests to shop locally, eat in local restaurants. This will be a blow to the rural tourism sector.”
A former journalist and estate agent, Ms Coudray describes running a B&B as “a passion-filled profession in its own right”. But she warns that the financial outlook is bleak: “We’ll be paying more in taxes and contributions, and left with less money in our pockets.”
She has launched a petition on change.org titled ‘Save the Guesthouses! Amend the Le Meur Law’, which had attracted nearly 2,400 signatures at the time of writing.
Many in the industry fear the proposed reforms could drive them out of business altogether – a shift that would leave many rural communities without vital sources of income, accommodation, and local tourism support.
