Categories: Taxation

Tax pressure reaches new heights in France

According to the latest edition of the Organisation for Economic Co-operation and Development &lpar;OECD&rpar; report on revenues published on Thursday, December 3&comma; the France is the second country with the highest rate of compulsory deductions&comma; at 45&comma;2 &percnt; in 2014&comma; after the Denmark &lpar;50&comma;9 &percnt;&rpar;&comma; and in front of the Belgium &lpar;44&comma;7 &percnt;&rpar;&comma; a "top 3" identical to that of 2013&period;&NewLine;This situation is due in particular to the rise in the tax burden on households&period; A development that is not unique to France&comma; but which makes it difficult to hear the message about tax cuts hammered home by the majority since 2014&period; In terms of taxation as in d'job - the unemployment rate, at 10&comma;6 &percnt; in the third quarter&comma; has reached its highest level since 1997 - government and presidential communications are struggling to keep up with the times convince&period;&NewLine;The preference for tax&comma; a history French&NewLine;While France's compulsory tax rate&comma; rose by 0&comma;2 points over the year&comma; appears much higher than the average tax burden of 29 OECD countries &lpar;34&comma;4 &percnt;&rpar;&comma; the increase in tax pressure is general in advanced economies &lpar;&more; 0&comma;2 points in 2014&rpar; &colon; "Tax revenues were severely impacted by the 2008-2009 crisis and have been steadily recovering since then. reach at a higher level than before the crisis"&comma; notes David Bradbury&comma; head of the organization's tax statistics department&period;&NewLine;France's preference for taxes is nothing new&colon; in 1965&comma; when the OECD launched its publication&comma; France was already vice-champion of compulsory deductions &lpar;taxes and social contributions&rpar; but behind theAustriaWith a rate of 33&comma;6 &percnt;&comma; 8&comma;8 points higher than the average for advanced countries&period; And&comma; between 1965 and 2014&comma; the tax burden has never fallen sustainably&period;&NewLine;Whose fault is it&comma; in 2014 &quest; Social security contributions&comma; mainly&comma; the report points out&period; Social security contributions account for 37 &percnt; of compulsory deductions&comma; compared with 26&comma;1 &percnt; on average in other countries&period; And their share of gross domestic product &lpar;GDP&rpar; is 16&comma;7 &percnt;&comma; including 11&comma;3 points for those paid by employers&period; And this&comma; despite the introduction of the Tax Credit for Competitiveness and Employment &lpar;CICE&rpar;&comma; which was ramped up in 2014 and resulted in a tax cut of almost 6&comma;5 billion euros for the companies&period;&NewLine;Transferring the tax burden&NewLine;One of France's exceptions is the low proportion of revenue from corporate income tax. companys &lpar;IS&rpar; and value-added tax &lpar;TVA&rpar;&period; In fact, France derives only 6 &percnt; of its revenue from corporate income tax&comma; compared with an average of 22 &percnt; in the rest of the OECD&period; The share of revenue collected from corporate income tax &lpar;TVA&rpar;&period; is much lower in France than in the rest of the OECD. title of this tax was reduced from 2&&comma;9 &percnt; to 2 &percnt; of GDP between 2007 and 2014&period; Similarly&comma; with VAT at 20 &percnt;&comma; Hexagone has a level of tax on consumption of consumption relatively lower than its neighbors &colon; in this area&comma; it ranks nineteenth&period;&NewLine;The OECD confirms taxpayers' feelings &colon; tax pressure on individuals has particularly increased in France since the crisis&comma; and this as early as 2011&period; Between 2007 and 2014&comma; theincome tax has risen from 7&comma;2 &percnt; to 8&comma;4 &percnt; of GDP&period; As a result&comma; its share of tax revenue has increased&comma; from 17&comma;1 &percnt; to 18&comma;6 &percnt;&comma; while at the same time&comma; that of corporate income tax has fallen&period; There has therefore been a transfer of tax pressure from SMEs and companies to households&period;&NewLine;"Urgent action is needed to ensure that companies bear their fair share of the burden".&NewLine;The report shows that corporate tax revenues are declining in all OECD countries&period; They fell from 3&comma;6 &percnt; of GDP in 2007 to 2&comma;8 &percnt; in 2014&comma; while at the same time&comma; income tax rose from 8&comma;8 &percnt; to 8&comma;9 &percnt; and VAT from 6&comma;5 &percnt; to 6&comma;8 &percnt;&period;&NewLine;Small consolation&NewLine;"The vast majority of tax increases since the crisis, in the form of higher social contributions, value-added tax and income tax, have been passed on to the public".summarizes Pascal Saint-Amans&comma; director of the Center from policy before adding &colon; "This situation highlights the urgent need for action to go to to ensure that companies bear their fair share of the burden&period; "&NewLine;<a href="http&colon;//www&period;lemonde&period;fr/economie/article/2015/12/04/la-pression-fiscale-atteint-des-sommets-en-france&lowbar;4824112&lowbar;3234&period;html&num;2xr0mwhqdcydjtey&period;99" target="&lowbar;blank">Read more</a> &NewLine;

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