Both owners and tenants could soon suffer the consequences of the universal territorial contribution (CTU)a local tax at the heart of many debates. This new tax, planned for 2025, is bitterly reminiscent of the defunct housing tax, abolished in 2023 for main residences. However, the reality of local authorities and the weight of the national debt seem to push towards a forced return to generalized taxation.
A disguised return of housing tax
The idea of this CTU arose after the loss of revenue estimated at 20 billion euros per year for communities following the abolition of the housing tax. The financing of local infrastructure is in danger, and the government, pushed by the mayors of France, seems ready to introduce this new charge, which would hit without distinction between owners and tenants. This levy would be based, according to its defenders, on a “more equitable and progressive” model.
Local revenues in crisis: the end of the tax “gift”
The CTU aims to respond to the growing needs of communities, faced with drastic budget cuts from the State, which are still planning a reduction of 5 billion euros in their budget for 2025. Despite a dizzying increase in property tax of 33% over ten yearselected officials consider these efforts insufficient and are looking for a funding model where “everyone contributes”.
A truly progressive tax?
The CTU would like to be progressive, with an amount calculated according to income to save low-income households. André Laignel, PS mayor of Issoudun, even goes so far as to suggest deductions from income tax to limit its impact. But many people denounce the “hypocrisy” of a tax which, under the guise of progressivity, would impose new burdens on households, in a context where inflation already leaves little respite for household finances.
Towards endless local taxation?
There is no shortage of criticism. For Éric Woerth, former Minister of the Budget, the CTU is the incarnation of “irresponsible management” of the public debt which today leads to overtaxing citizens, “tenants and owners alike”, to fill coffers that the State empty with no concrete return for the taxpayer. Faced with this spiral of local taxes, the CTU could well be the first step towards a pure and simple return of the housing tax, a “burden” that the State had nevertheless promised to eliminate.
The universal territorial contribution, far from relieving public finances, could thus lead taxpayers into a unlimited local taxationquestioning the priorities and transparency of community financing.
