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Certain reforms that are emerging do not please the French at all. Others, on the other hand, represent great economic progress. At least that’s what UFC-Que Choisir points out regarding a major change that awaits taxpayers in 2025.
This change will have a particular impact on married or civil partnership women, especially those whose income is lower than that of their spouse. A reform, which should see the light of day on September 1, aims to correct a tax inequality which, until now, mainly disadvantaged women in this type of situation.
Review current taxation
Currently, married or civil partnership couples are subject to withholding tax. And this, according to a single rate for the tax household. This rate is calculated taking into account the joint and individual income of the spouses.
However, this method creates notable inequity. Indeed, the lower-income spouse bears a tax burden disproportionate to what he or she would pay if single. At the same time, the higher-income spouse benefits from a lower tax rate than he or she should.
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For UFC-Que Choisir, this is a tax bias. A bias that has lasted too long. Couples know this and, for years, they manage to circumvent this inequality. How ? By already opting for an individualized deduction rate, based solely on the income of each member of the couple.
But this solution requires a proactive approach. However, the majority of couples are unaware that such a possibility exists. This is why the UFC-Que Choisir is delighted with the upcoming reform.
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The finance law for 2024 introduces a reform which will come into force on September 1, 2025. From now on, Spouses with lower incomes, often women, will automatically benefit from an individualized deduction rate.
The calculation of the rate will be done only on personal income. The reform therefore puts an end, to the great happiness of UFC-Que Choisir, to the automatic application of the overall household tax rate on their income. However, couples who prefer to maintain a single rate for their household will always have the possibility of doing so upon joint request.
This reform mainly targets working or retired women whose income is lower than that of their spouse. But it will also have consequences for couples where one partner receives significantly higher remuneration than the other.
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According to a study by UFC-Que Choisir, this tax change will benefit women in 8 out of 10 cases. Enough to offer them a significant financial gain.
An impact on the richest men
If this reform rebalances tax burdens for women, it will also have the effect of increasing taxes for better-paid men in the couple.
The latter will have to expect a greater tax burden, proportional to their personal income. However, this is not an injustice. For the UFC-Que Choisir, it is on the contrary a “ fairer withholding tax« .
This change is part of a desire to make the tax system more adapted to the realities of household income. By aligning the samples on individual incomethis measure helps reduce a form of economic discrimination that particularly affected women in households with unequal income.
Source: UFC-Que Choisir
