“Tax the rich”… This is not a demonstration slogan but one of the measures announced by the government via the establishment of a “exceptional contribution”. The use of fiscal leverage to clean up France’s very degraded public accounts, in addition to spending reductions, marks a turnaround after seven years of tax cuts carried out since the election of Emmanuel Macron as President of the Republic in 2017.
1. Why implement such a measure?
Wealth tax, exceptional tax… the government is trying by all means to find money to fill the public deficit and ” find “ 60 billion euros. The introduction of an exceptional contribution on high incomes is one of the measures announced. “This tax justice measure corresponds to a targeted effort on high-income households who, in particular through sustained use of exceptional tax measures, see their effective tax rate decrease”explained the government.
2. What are the criteria for having to pay this contribution?
The Ministry of Budget had initially indicated that the measure would concern around 65,000 households in Franceon the 20 million households paying income tax. “The base of 65,000 households” used “as a basis for this targeted, temporary and exceptional contribution” is that of the exceptional contribution on high incomes (CEHR), that is to say households with a reference tax income greater than 250,000 euros for a single person and 500,000 euros for a couple, the Ministry of the Budget specified on Saturday evening.
But to be responsible for this new contribution, “you must be subject to the CEHR and have an income tax rate of less than 20%”says the same source, presenting the measure as a “net avoiding tax optimization”. Only a little more than 24,000 households would therefore be affected in this scenario, according to Bercy’s figures.
3. Until when will this contribution be requested?
Who says exceptional, says temporary. According to Bercy, this contribution must apply until 2027. But be careful, the number of exceptional taxes which have continued is legion. The measure is supposed to bring in 2 billion euros in 2025 and contribute to the recovery of public finances.
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