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What's on the horizon for 2011?

Property, taxes, travel, politics - everything that's due to change in France this year

2 February 2011

Technology

A KEY part of plans to make state procedures more accessible over the internet is due, called IdéNum. This is likely to involve plugging a USB key into your computer and typing in a single PIN, to be identified on all government sites. Bodies like banks and insurers, La Poste and the notaires are also interested. Online payment and bank transfer options for all public bodies are also promised this year, plus 10 new key online procedures for individuals and 10 for firms eg. applying for child or housing benefit, procedures linked to hospital stays or stopping work for illness, planning permission, customs declarations and declaring staff hired.

ROAMING charges for using a mobile abroad in the EU will have a ceiling of €0.35/minute from July 1 (from €0.39).

ANALOGUE television stops on November 29. The Languedoc-Roussillon will be the last region to be switched off and go "all-digital".

Property

THERE is no longer a tax credit on mortgage interest for homes purchased. However the interest-free loan available from the state for first-time buyers has been made more generous in most cases. It will now be available to all first-time buyers. Previously, for example, a single person in Paris, on the Swiss border or the Côte d'Azur could not have one if they earned more than €31,250 (or €23,688 elsewhere). The amount of the loan will also in many cases be substantially more, especially if the property is rated A-D for energy efficiency, or in the case of new-build if it meets the latest strict "BBC" low consumption standards.

Also changing, from March, is the Plan Epargne Logement (PEL), an income tax-free savings scheme for building up a home purchase deposit. The state gives a bonus when one is used to buy, at a percentage of the interest accrued in it, subject to a maximum ceiling. The ceiling will now be set higher or lower depending on energy-efficiency factors. Interest rates for new PELs will be revised annually taking into account average rates for long-term savings. The rate will never drop lower than the present 2.5 per cent, unchanged for 10 years. Money in the schemes will be subject to annual social charges on interest: at present, back-dated charges are only taken off at the ten year mark (and then annually) or when the account is closed.

NEW rules relating to a special tax regime for British residents who rent out a French holiday home for a substantial part of the year are planned from April. They introduce tougher conditions to benefit.

FROM this month, owners of homes with a septic tank must supply potential buyers with a certificate showing they conform to high standards. A diagnostic assainissement (waste water system check) is added to the list of property checks owners have to have done.

A NEW map outlining parts of France where construction is banned because of flood risk will be published. The Ecology Ministry is redrawing existing boundaries following last year's floods in the Var. New building will be banned in zones marked as the most dangerous and some existing homes could be subject to compulsory purchase and destroyed.

AIDE personalisée au logement (APL) housing benefit will no longer be backdated to cover up to three months' rent payments, but will start from when it is approved.

LIFTS in apartment blocks should have been brought up to new standards by now. At the end of September the national Lift Federation said 80 per cent of them had been done.

PROPERTY adverts must now show energy efficiency ratings (from A-G).

Home and family

REFORMS of the second year of lycée, the première, are planned for the autumn. Studies will include a reinforced common core, to make things easier for those who change study and career plans. Short holiday courses will help people who want to make changes to Bac choices. There will be new personalised support sessions.

MEASURES to reduce violence in schools, called CLAIR, will be rolled out in the autumn. They include extra teacher training on conflict resolution, "school life commissions" to meet weekly in schools to discuss solutions for dealing with difficult pupils, and schools drawing up charters on rules of community life.

A REDUCTION on employers' social charges paid by people employing home-help (eg. using the Cesu payment system) was expected to be abolished as Connexion went to press, making the cost of employing nannies, home tutors, gardeners etc more expensive for many people. The reduction (making the charges 15.1 per cent of the salary paid instead of 30.1%) applies where you opt to pay charges based on actual wages paid (called le réel), which gives better pension rights to the employee, as opposed to a forfait (standardised) system based on the minimum wage, which gives lowered employer's charges but disadvantages the employee.

THE POSTAL market is theoretically fully open to competition from this month, as the monopoly on light letters ends. La Poste is also set to become a mobile phone operator. It plans to offer La Poste Mobile, in a partnership with SFR, whose network it will use.

Politics/government

MAYOTTE, an island north-west of Madagascar, becomes the 101st French department. It will be the fifth department d'outre mer. It has been a French-owned territory since its sultan sold it to France in 1841 en viager (with a lump sum and a lifetime rent for hismelf), however the status of overseas department means it will be run just as if, for example, the Dordogne were to be detached from France and put in the Indian ocean, with all the same laws and institutions. President Sarkozy agreed to hold a referendum on becoming a department, which saw a majority in favour, in 2009.

THE Front National will choose its new leader this month, as Jean-Marie le Pen steps down. The race is between his daughter, Marine, and Bruno Gollnisch, joint vice presidents.

PRESIDENT Sarkozy will take a decision this year on whether or not to stand for reelection as president in 2012.

HALF of the departmental council wards are up for reelection of councillors in March. Only French citizens can vote in these elections cantonales.

FRANCE has the presidency of the G8 and G20 and will host their annual conferences: in Deauville in June and in Cannes, in November. They are meetings of leaders of major democracies, the former focused on seeking solutions to world economic and social problems, the second mainly on financial sector reforms.

BABIES’ milk bottles containing Bisphenol A have been banned from sale. The chemical has been linked to serious illnesses such as cancer and diabetes.

A WORKING group of experts studying possible changes to school hours reports to the government in the spring. They have been consulting with parents' and teachers' associations.

Tax

PROPERTY owners’ representatives Unpi predict rises in local taxes in many areas. This is because of factors the taxe d'habitation will only be collected by communes, not departments, this year. Departments often made use of generous allowances for poorer families. It is also thought local councils may have less in their coffers due to last year's scrapping of the professional tax (though a replacement has been put in place, the CET).

A LAW is expected to be passed in the spring scrapping both the ISF wealth tax and the tax shield (which caps total tax paid in a given year at 50 per cent of income). However it is expected that new kinds of taxation on income from capital and on capital gains will be introduced to compensate (the wealth tax brings in more than the shield hands back).

TAXATION of newly-married or pacsed couples will change relating to income for this year, declared next year (barring any lastminute parliamentary u-turn). Instead of a joint declaration for the married period plus two individual ones for the start of the year, they will make one joint one or two individual ones. Due to the way the tax bands work the current method makes for less tax.

CHANGES in the 2011 budget law will generally make life more expensive, with various tax advantages removed and taxes raised. Final tweaks were possible as Connexion went to press, but they are expected to include: "Tripleplay" internet, TV and phone offers subject to full 19.6 per cent VAT, not 5.5 per cent; the top income tax rate raised from 40 to 41 per cent; more tax on savings and investments: an extra one per cent of tax on capital gains, interest
and dividends (and three per cent on property capital gains), raising related social charges from 12.1 per cent to 12.3 per cent, and removing an income tax credit on dividends.

Many so-called niches fiscales (ways of investing so as to obtain tax reductions) have had the amount of the investment that can be taken off tax reduced by ten per cent. These include the Scellier scheme (investing in new buy-to-rent property) and buying shares in FCPIs or FIPs (schemes that invest in small and medium-sized business). Ones spared include those for paying for home help and for direct investment into small businesses. An overall annual limit on combined niches that households can benefit from in a given year is being lowered, from €20,000 plus eight per cent of income, to €18,000 plus six per cent.

A reduction on ISF wealth tax for investments into small business is cut from 75 per cent to 50 per cent. A “Google tax” at one per cent on online advertising, payable by the advertiser, is set to be introduced in July.

Personal finance

BRITISH-BASED money transfer bodies must all now be FSA-registered by May 1. You can check which ones are already fully approved at www.fsa.gov.uk/register

MANY top-up health insurance policies could rise 4-10 per cent this month according to an industry body la Mutualité Française. This is due to a new tax on most of these policies plus rising costs due, for example, to certain medicines
for minor ailments being state reimbursed at lower levels.

A study by analysts Xerfi said car insurance is also likely to go up around 2.5 per cent, the steepest rise since 2004, due to rising accidents and costs of repairs. However national economics newspaper les Echos predicted 2-5%.

ELECTRICITY bills are also likely to rise more steeply than usual, due to planned changes to rules on setting the CSPE tax that is levied on bills. This goes to finance renewable energy schemes, supplying electricity to overseas territories and discounts for the poorest customers.

NEW rules on pensions come into play from July 1. Notably, the age at which people retire will start to be progressively increased, reaching 62 (from 60) by 2018.

ASSURANCE vie (life asurance) funds of the “multisupport” kind (invested in euro funds as well as shares ones) will have social charges applied to the euro fund part annually. Previously charges were only applied to them when withdrawals were made.

NEW BANK tariff brochures will feature a prominent list of ten key services and their prices, so people can see at a glance how they compare. Banks have also agreed to standardise terminology and that from the end of June, monthly statements will show a total of charges applied in the previous month.

Travel

FOLLOWING the 2009 introduction of the five-star hotel, 2011 will see the first ones given an official “palace” rating. The term has long been used to describe luxury hotels, but was not officially recognised by the state. “Palaces” will have to boast rooms of at least 26m2, as well as spas, gyms, massage, hairdressing and beauticians, child-minding, free laundering, currency exchange and trilingual staff. Factors such as a world-famous restaurant or a location near a Unesco world heritage site will help hotels to make the grade. About 20 of France’s 98 five-star hotels are expected to be awarded the new title this year.

IT WILL be obligatory for pets to be microchipped if they are to travel across borders in Europe from July 3. Currently a tattoo is enough for travel to most countries.

THE BIGGEST ferry designed for the Dover to Calais route enters service this month. The 213m, 49,000-tonne Spirit of Britain is one of two new ships for P&O. Spirit of France, enters service in September. LD Lines launches a new ferry, Norman Leader, on the Portsmouth-Le Havre route in May.

A TRAMWAY system opens in Angers, capital of the Pays de la Loire, in June. Douai, Nord-Pas-de-Calais, expects to open a second line after its first one last year. The Rhine-Rhône LGV line (fast track for TGV trains) also opens.

BUDGET airline Jet2 is starting a new Brive to Manchester route. It will operate two return flights a week from May 21 to September 24. The airport, which opened last year, already flies to London City. Flybe has just launched a Nantes to Manchester route.

VATRY airport, east of Paris, wants to offer at least one more low-cost airline this year. It is in discussions with Ryanair for one to southern Europe and with Wizzair for an eastern Europe one. It has been running Ryanair flights to
Oslo and Stockholm since last year.

AIR France has abandoned plans for a low-cost subsidiary that was to have been launched this year. However the firm, based at Paris Charles de Gaulle, says it aims to cut the price of short and medium-haul flights generally, by establishing new regional bases, initially in Marseille, Nice, Toulouse and Bordeaux. A first one may be operational this year.

A GROUP of former Concorde maintenance workers hopes to get the plane rolling down a runway for the Paris Air Show in June. The enthusiasts say they feel nostalgic for the days when it flew. They are refurbishing a place that was last used in 2003, so it can taxi on the airfield (though it will not take off).

Driving

PARKING fines are expected to almost double, from €11 to €20, so they will be a greater deterrent. This year also sees the roll-out of electronic motoring fines, where officials note details on an electric pad that sends them to a central database. You will get a fine notice in the post, instead of a piece of paper on the windscreen.

THE prime à la casse bonus for swapping an old, polluting car for a new, low-emission one, has been scrapped. It only applied to cars ordered by the end of 2010, though the actual bill of sale can be made out up until the end of
March. It has been progressively reduced, and the last payments will be €500 off the price of the new car.

CONDITIONS for the bonus for buying an eco-friendly car (between €100 and €5,000) or penalty for buying a gas-guzzler (€200 to €2,600) have been toughened. The level of carbon dioxide production per kilometre needed for the bonus has been decreased by five per cent, while the level at which the penalty kicks in has also been decreased five per cent. The new levels do not apply if the car was ordered before the end of last year.

ALL MOPEDS will have to be officially registered with the prefecture this year. This is already required for new ones, but older models were previously exempt.

Events

FRANCE’S biggest annual fundraiser, the Téléthon, which raises about €100 million, is expected to have a new format in 2011, as a 23-year-old contract between France Télévisions and the event’s beneficiary muscular dystrophy association AFM has come to an end. There has been controversy about how effectively AFM uses the funds, and many people would like to see it benefit a range of charities. It will not however be axed, as had been rumoured, AFM and TV bosses have said.

THE Tour de France starts from the Vendée on July 2. The tidal causeway of the Passage du Gois, linking the Ile de Noirmoutier to the mainland, is the first stretch, followed by Brittany and Normandy. It will be a high-altitude race, with six mountain sections.

Health

ONLINE medical records, already trialled in some areas, will be rolled out. Patients will be able to access the records, which will be maintained by certified internet hosts. The dossier médical personnel (DMP) is meant to help better coordinate medical care. From this year, doctors will also be able to offer online consultations; however, local health authorities will first have to authorise schemes in their areas.

A CONSULTATION is taking place on the problem of the increasing number of dependent elderly people. A decision will be taken by the government this summer on new ways to cope, which could include new kinds of insurance or taxation.
A GP consultation is to go up one euro from €23 to €22 this month.

SHOCKING images of disease will be put on all cigarette packets this year. The pledge was made by the Health Minister last year.

HOSPITALS will have to start doing satisfaction surveys of patients. The results will be made public.

CERTAIN medicines considered to have only a “moderate therapeutic effect” are being cut to 30 per cent reimbursement from 35.

“BIRTH houses” will be trialled. In these set-ups, women can give birth in safe but less “medicalised” surroundings than a hospital.

Work

A NEW kind of business status, the EIRL (entreprise individuelle à responsabilité limitée: limited liability sole trader business), launches this month. Sole traders can now legally separate business and personal property so that the latter is protected from business creditors. This gives them similar protection to limited companies. You can set up directly as an EIRL or adopt the status for an existing firm (including auto-entrepreneurs).

THE minimum wage is expected to rise to €9/hour this month, from €8.86.

A 14 per cent tax on retraites-chapeaux (top-up pensions for the bosses of big businesses) has been created. It will not apply to sums of less than €500/month and will be seven per cent for €500-700/month.

GETTING more young people into work will be one of the government’s priorities this year. There will be discussions with the unions on the subject early in the year.

Justice

JURIES may be introduced in the tribunaux correctionnels, which judge délits, crimes of medium seriousness. At present they are only used in tribunaux d’assizes, which judge crimes (murders and rapes).

Environment

THIRTEEN cities selected for government loans to help them create new “eco-districts” have been given until March to submit outline projects. They must use renewable energy sources and have efficient public transport. The cities include Bordeaux, Rennes, Montpellier, Nantes, Marseille and Nice.

MONEY paid to people who sell back electricity from solar panels to EDF is expected to be reduced for people producing more than a set quota.

USE of electric vehicles by public bodies will be boosted with the first deliveries of new ones under a bulk purchase scheme.

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