PARIS (MNI) – The new French government intends to hike taxes by
more than E7 billion in the mid-year budget revision to be presented in
cabinet Wednesday, according to the French press.
The business daily Les Echos put the cumulative tax increases at
close to E7.5 billion – towards the lower end of the E6-10 billion
revenue shortfall projected by the Audit Court in view of this year’s
public deficit target of 4.5% of GDP.
The largest hikes aim at reversing the fiscal favors of the
previous government, notably for individual assets and tax-free overtime
hours for firms with more than 20 employees.
“The measures to be adopted in cabinet today are precisely the
demonstration that the time of a certain number of privileges is behind
us,” Interior Minister Manuel Valls explained in a radio interview.
The increase in taxation of stock options begun by the previous
government will be accelerated to lift the rate from 14% to 30% for
employers and from 8% to 10% for employees. Firms will also have to pay
3% on distributed dividends.
Taxes on financial transactions and systemic risks will be doubled
to 0.2% and 0.5%, respectively, according to Les Echos. An exceptional
4% will be levied on oil stocks. There will also be tighter controls on
large groups that manipulate their financial reports to limit taxes on
profits. Individuals who seek tax shelter abroad will see their domestic
property taxed by 15.5%.
Firms with more than E250 million turnover will pay an exceptional
advance of 5% on their results at the end of the year, according to the
daily Le Figaro.
Company profit-sharing and savings schemes will see their taxation
jump from 8% to 20% for an expected revenue gain of more than half a
million this year and E2.2 billion next year, Les Echos said, noting
that the receipts will be earmarked to the social security deficit
projected at close to E15 billion this year.
–Paris newsroom +331 4271 5540; Email: ssandelius@marketnews.com.
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