Restaurant VAT cut should be scrapped
61% of people in a survey are in favour of the €3bn tax break for restaurants being taken away
ALMOST two thirds of French people want restaurants to lose the right to charge a specially discounted VAT rate, a new survey has revealed.
The BVA poll for La Tribune and BFM radio found 61% of people disapproved of the €3bn tax break, which has allowed restaurateurs to pay 5.5% VAT instead of 19.6% since last July but has had little effect on the prices paid by consumers.
According to restaurant union Synhorcat, prices have fallen by 1.7% since the VAT cut came into force on July 1 last year.
The group says 5,700 extra jobs have been created and starting salaries are up 25%.
However the government had given restaurants a target of a 3% price drop and 20,000 jobs within the first year.
The VAT discount came top in the BVA poll of tax breaks that should be dropped. Overall, 55% of people surveyed said they supported the government getting rid of a number of tax avoidance schemes to improve its financial situation.
The only tax break that the majority of respondents were eager to keep was the 10% flat-rate deduction applied to income when filling out a tax return.
The French national audit office, the Cour des Comptes said in its annual report earlier this year that the government offered too many tax discounts and exemptions, totalling €70bn a year, without finding a way of making up the lost revenue.
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