Income tax: Here are the French who will be favored by the indexation of the scale on inflation

Income tax: Here are the French who will be favored by the indexation of the scale on inflation
Written by madishthestylebar

Concerns are being felt in the face of the rise in the tax bill that is coming. With the exception of 2012 and 2013, updating the income tax scale is common practice.

Bruno Le Maire wants to be reassuring

Many are worried. The announcement of the increase in the income tax scale is the reason. This is not new, of course, but this year the deal could change. Inflation would have had an impact on the reassessment of the income tax scale.

Here are two possible scenarios: in a milder scenario, the price increase in 2022 could be 3.7%. This is according to the assessment of the Banque de France. In the other hypothesis, which is the least tender, the valuation would reach 4.4%.

However, Bruno Le Maire, French Minister of the Economy, wanted to be reassuring during his interview on BFM-TV / RMC. He thus declared that they would “index the income tax scale to inflation. According to the Minister, this is to “avoid threshold effects where people switch to income tax or an additional bracket. »

The minister was clear in his remarks by saying that there was no question of the French paying more taxes because of inflation. Inflation reaching 5.2% over one year according to INSEE.

Here are the Minister’s words:

“I want to remove this concern. It’s not about the French paying more taxes because of inflation. It is out of the question that employees, like the French, pay more income tax because of inflation. »

And he took the opportunity to repeat President Emmanuel Macron’s campaign promise not to raise taxes.

A common operation

This operation is common. Indeed, since 1969, to take inflation into account, this income tax scale has always been reassessed every year. Of course, 2012 and 2013 are exceptions.

Nevertheless, in his remarks, Le Maire speaks of this operation as an operation specific to the current government. Anyway, that’s the impression it gave. What did not please Internet users. The latter therefore wanted to remind the Minister, on Twitter, that indexation to income is a measure that has always been carried out every year.

But this year, given the inflation which, for several months, has reached an unusual level, the financial and tax issues are particularly important. It is certainly linked to what is currently happening in Ukraine. For an unmarried person, the entry threshold for income tax is currently 10,225 euros per year.

Of the four brackets that make up the income tax scale, the tax rates range, for the lowest incomes, from 11% to 45% for the highest incomes.

Beneficial indexation for taxpayers

For several weeks, measures have followed one another to protect the wallets of the French. However, the government does not want to give in to the temptation to increase more revenue. As some households will not be taxable, French people, thousands of French people, will not see their taxation increase. This is due to the indexation of the income tax scale to inflation and to the raised thresholds.

By the same token, a mechanical increase in tax will be avoided by this indexation of the income tax scale, with a price index that increases faster than the real increase in income. What will be for the taxpayers, an advantage since the State will make less receipts.

During 2012 and 2013, the French government proceeded to non-indexation. As a reminder, at the time, inflation was around 2%. This prompted 400,000 new French households to submit to income tax, and therefore allow 1.7 billion euros in tax revenue. An additional cost of 80 euros was also to be paid by many households.

We are talking about 20 million households. And more than 300,000 households in the last tranche saw this average rise to 500 euros. The French therefore fear that the same thing will happen.

#Income #tax #French #favored #indexation #scale #inflation

About the author


Leave a Comment