Council of State issued a Ruling on July 1, 2026, in favor of the company Lunii, which contested the application of the standard VAT rate of 20% on its audiobook storytellers for children. The High Court administrative judge adopted the approach of Lunii, which asked for the same treatment, and connected the applicability of the reduced rate of 5.5% for audiobook storytellers.
In simple terms, Lunii asked a Judge to apply the same approach to its “audiobook products” as it is the approach to other types of books, printed, digital, or e-books. The principal part when it comes to tax treatment should be the “storytelling/recorded audiobook”, and not the device on which the book is stored.
In the Ruling, the respective Judge took the position that the principal object of the taxation should be the audiobook, considering that the “storytelling device/box” is acquired as an inseparable part of the content narrative, which was the only aim of the purchase.
The VAT rate should follow the tax treatment reserved for books, and not the rate allocated for the tangible medium – storage device in this case.
Reduced Rate for Audiobooks
Considering that the Council of State decision overturned the Guidelines issued by the tax authorities, the French Public Finances Department launched a public consultation opened on July 20, 2026, opened until September 30, 2026.
This consultation could lead to the overturning of the adopted approach when it comes to taxation of audiobooks, delivery methods, and similar taxation rules in this matter. If approved, it will revise the approved rules by the French Public Finances Department, which are codified in the BOFiP publication.
BOFiP guidelines on this subject matter adopted the approach that these, and similar products containing audiobooks, shared the approach that these storage devices were a central element of the product, and not merely an accessory for pre-loaded audiobooks.
In sync with this approach, the tax authorities applied the same VAT rate, 20%, as it is allocated to speakers, whether connected or not. The storage device with pre-loaded audiobooks followed the treatment of the physical medium.
The Council of State adopted a completely different approach. It follows the perspective that the acquisition of the “storytelling box” is specifically made under the willingness to purchase the audiobook content that is already included in the physical device.
These types of audiobooks can only be listened to using the device that contains them, and following that logic, the device is inseparable from the audiobook stored in it, and this was designed in this manner only for the purpose of permitting children to follow the content in this manner.