Faced with the economic consequences of the coronavirus crisis, the wealthiest 20% of French people will finally continue to pay the housing tax, the total elimination of which was to be effective in 2023. This was announced Emmanuel Macron Tuesday during his first television interview on July 14.
The president explained that “shifting the abolition of the housing tax a little for the wealthy among us” was a “possible option” and that the postponement could “be something legitimate in times of crisis. “
In his speech to the National Assembly on Wednesday, Prime Minister Jean Castex, however, did not discuss the subject, when he was to detail the government’s roadmap for the coming months.
A legal obstacle
“If it is retained, it will be necessary to redo a law to shift it,” explains a source to the cabinet of Bruno Le Maire, the Minister of the Economy. Since the timetable for the reform has been included in the Finance Bill for 2020, going back on this text poses legal concerns indeed.
According to our information, for legal reasons, the abolition of the housing tax for the wealthiest 20% of French people could be delayed by only one year. Beyond that, the Constitutional Council would risk putting its veto.
29,790 euros to be within 20%
As a reminder, 80% of tax households have been exempt from housing tax for their main residence since this year. Only the richest 20% of French people still have to pay this local tax.
According to INSEE, income above 27,706 euros for a single person is therefore concerned (or 2,482.50 euros per month) or 56,438 euros for a couple with two children.
The median standard of living in France being 1,692 euros per month (or 20,300 euros per year), half of households earn less than this sum.
The 10% of people with the lowest standards of living in the population have an annual standard of living below 10,860 euros (905 euros per month).
The disappearance of the local tax was initially to be done in three stages for the wealthiest households, between 2021 and 2023: a third of the amount abolished in 2021, a second third in 2022 and the last in 2023.
For the State, postponing this tax reform for a year would, despite everything, save seven billion in three years.
A flagship measure of Macron’s program
The reform of the housing tax is one of the emblematic measures of Emmanuel Macron’s program. At first, he planned to delete it for only 80% of households. But at the end of 2017, the Constitutional Council had warned the government against this measure, in the name of the equality of all before tax. Without saying that the reform is necessarily unconstitutional, he promised to be “vigilant” as to its implementation.
In order to put an end to the controversy, Emmanuel Macron then decided that the measure should be generalized.