CAPGEMINI_REGISTRATION_DOCUMENT_2017

FINANCIAL INFORMATION

4.2 Consolidated Financial Statements

introduced by the first{2017{amending Finance Act, increasing by 30% the income tax liability payable by the Group fiscal unity in France for fiscal year{2017 only; in the United States, the Transition Tax on Foreign Earnings X introduced by the tax reforms, a one-time charge on accumulated undistributed earnings and profit of US{owned foreign subsidiaries, for €17{million, and certain State taxes; in Italy, the regional tax on productive activities (IRAP). X In addition to the change in the US{federal tax rate and the Transition Tax on Foreign Earnings, the US{tax reforms introduced other measures applicable to the Group, for which further clarification is expected. These measures include: the Base Erosion and Anti-abuse Tax (BEAT): this alternative X tax is applicable from{2018. The tax rate will be 5% in{2018, 10% for the tax years{2019 to{2025 and 12.5% thereafter. The tax base is distinct from the corporate income tax base and includes certain payments to non-US{group entities, normally deductible for tax purposes. The tax amount is compared with the standard income tax expense calculated at the standard rate, and the higher of the two amounts is payable; the tax on Global Intangible Low-Taxed Income (GILTI): X earnings and profits of foreign subsidiaries in excess of a 10% return on the tangible assets of the subsidiaries are included in the taxable profits of US{companies. A 50% deduction is applied to the tax base and the tax rate is 21%. Foreign tax credits may be deducted after the offset of available tax losses carried forward. Based on current market interpretations, in the Group’s opinion, these two measures introduced by the recent US{tax reforms will not impact the calculation of the Group consolidated tax expense or the valuation of Group deferred tax assets in the United States as of December{31, 2017.

The “Difference in tax rates between countries” mainly comprises: in{2017, the impact of the progressive reduction in the X corporate income tax rate in France, following the 2018{Finance Act, to{25.82% by{2022; in{2016, the impact of the reduction in the corporate income X tax rate in France, following the 2017{Finance Act, to{28.92% by{2020. The “Remeasurement of deferred tax assets on US{tax loss carry-forwards” of €299{million as of December{31, 2017, reflects the change in the taxable profit outlook since the last remeasurement of US{deferred tax assets in{2015. Tax loss carry-forwards in the United States are now fully recognized in the Group consolidated financial statements as of December{31, 2017. The “Impact of change in US{federal tax rate” reflects the change in our tax rate from 39% to 26%, following a decrease in the federal tax rate from 35% to 21% as part of the tax reforms introduced by the Tax Cuts and Jobs Act signed into law on December{22, 2017. The value of Group deferred tax assets was decreased by €295{million at December{31, 2017. The “Taxes not based on taxable profit” primarily consists of: in France: X the Corporate Value-Added Contribution ( Cotisation sur la ❚ Valeur Ajoutée des Entreprises , CVAE), the repayment to Capgemini{SE of the additional 3% ❚ contribution on distributed earnings following the October{6, 2017 decision of the Constitutional Court that it was unconstitutional, the exceptional corporate income tax contribution and the ❚ additional exceptional corporate income tax contribution,

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REGISTRATION DOCUMENT 2017 — CAPGEMINI