The Senate voted this Tuesday, November 26, to increase the Flat Tax against the advice of the executive. This increase could be applied from 2025.
An increase of 30 to 33% for the Flat Tax. This Tuesday, November 26, the increase in the Flat Tax was adopted by a very narrow majority, 174 votes from the left and the center against 167 from the Macronists and the right in the upper house in public session.
Proposed by an amendment from the senator from Hérault, Christian Bilhac (European Democratic and Social Rally), this measure did not please the government. The Minister of Budget and Public Accounts, Laurent Saint-Martin condemned a striking amendment “a comprehensive tax package which has made it possible, I am convinced, to bring more investment into the country”.
Several attempts aimed at implementing this increase had been initiated by the left in the National Assembly. None was successful, the Macronist deputies, from the right and the far right having opposed it.
AN INCREASE IN AN UNCERTAIN FUTURE
This tax was introduced in 2018, and followed the abolition of the ISF by Emmanuel Macron, the objective of this single flat-rate levy (PFU) being to encourage wealthy taxpayers to invest in the economy.
If there is talk of a flat rate, it is because the PFU does not take into consideration the tax bracket or the reference tax income. The Flat Tax thus constitutes a form of exceptional taxation.
The increase voted in the Senate aims to increase the PFU, known as Flat Tax, from 30% to 33% from 2025. Until then, it includes 17.2% social security contributions and 12.8% flat-rate tax and is applied to savings income. and capital excluding real estate. Life insurance, savings accounts and income from movable property are, for example, affected.
This increase in taxation of investment income is, however, uncertain, given the possibility of recourse to article 49-3 of the Constitution by the government. If necessary, the executive would be free not to retain this amendment.
