2023-08-23 12:18:39
The progression of the property tax is spectacular this year in certain municipalities, which undermines the government’s discourse on tax cuts.
“There is no question of raising household taxes”. At the end of the summer, Prime Minister Elisabeth Borne, who spoke this Wednesday at the microphone of France Bleu, tries to reassure taxpayers while the preparation of the 2024 Budget promises to be complicated. However, many households will very quickly be able to see that the tax hike (the rate of compulsory levies reached a historic record in France in 2022) is far from over.
The Directorate General of Public Finances indeed began to send by post on Tuesday property tax notices for non-monthly people, as confirmed by the DGFiP to BFM Immo. In addition, “property tax notices for non-monthly people will be put online on August 30, for monthly users it will be September 22”, further specifies the tax authorities.
And this year, many taxpayers can expect very unpleasant surprises when they return from vacation. As a reminder, in order to calculate the property tax, the tax authorities start from the cadastral rental values to which deductions are applied and then apply several levy rates (a municipal rate, an intermunicipal rate and a departmental rate). The increase in property tax can therefore come both from the increase in cadastral values and from the increase in rates decided by local authorities.
+59% in Paris over one year
However, in 2023, the increase in cadastral values will be very significant: +7.1%. In other words, even if your municipality does not increase the property tax rate, the painful will still increase “automatically” by 7.1%. Then, some municipalities have increased the rates once more this year. According to the president of the Association of Mayors of France (AMF), David Lisnard, 19% of cities are in this case this year. And for some of them, the leap is spectacular:
The rate applied for property tax soars by 52% in Paris (to which must be added the 7.1% increase in cadastral values, i.e. an overall increase of 59%) +25% in Grenoble (i.e. +32% in all)+14.3% in Metz (+21% in all)+10% in Limoges (+17% in all)+9% in Lyon (i.e. +16% in all)+4.5% in Bordeaux (+ 11.5% overall)
How to explain such progressions? This Wednesday, Elisabeth Borne tried to send the hot potato back by referring to the “decisions of local authorities”. The latter “may have the capacity to increase them according to the evolution of inflation” but “I have no doubt” that they “will be attentive to the stakes of purchasing power”.
A tax cap game
In reality, for the taxpayer, it is a huge tax cap game that has been going on for a few years. In particular with the gradual abolition of the housing tax for main residences (but not for secondary residences). The government claims to have compensated to the nearest euro for the municipalities for the loss linked to this abolition. But for many cities, the account is not there. Especially since some of them are suffering in parallel from reductions in funding… from the State. However, they only have the lever of the property tax left if they want to increase their revenue.
The fact remains that according to the Court of Auditors, the situation of local finances has generally improved in 2022. investment and their indebtedness”, explains the Court of Auditors which mentions a “high” cash position of 60 billion euros. The gross savings of communities (ie the balance between revenue and operating expenses) amounted to 44 billion euros, a new historic record. However, there are strong disparities with certain municipalities in great difficulty and which do not have enough revenue.
Be that as it may, for French owners, it’s a cold shower compared to the regularly promised tax cuts.
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