Measures to limit rises to the taxe foncière property tax are set to be announced this autumn by the finance ministry.
The tax is calculated using a home’s rental value – the income it would theoretically generate if it were rented out – which changes each year in line with inflation, set to reach 7% year on year in September.
Extend renters’ cap to homeowners
France took action to shield renters from the cost-of-living crisis earlier this summer, capping rent rises at 3.5% for a one-year period.
Now it is reported that the government is considering introducing a similar measure for homeowners, which will be debated when it presents its budget for 2023 in the autumn.
Local authorities set the percentage paid
Although the finance ministry has the power to cap rental values, tax due is then calculated by applying a rate set by local authorities.
Several cities have already announced significant rises to these rates, including 14% in Marseille.
Property-owners’ association the UNPI has called for a rental value freeze but said this “will not have much impact in cities like Marseille. That is why, ideally, local tax rates would also be frozen”.
They did however add that the measure being proposed would be better than nothing. “Limiting taxe foncière rises is one of our demands for maintaining the spending power of property owners, who have multiple challenges to overcome, including energy renovation work and the rental price freeze.”
With a few exemptions, the tax is due on all property-owners.