One in five French mayors considering local tax rises in 2023

Rising costs may also result in spending cuts concerning street lighting, heating in public buildings and highway maintenance, a new study has suggested

Some 18% of French mayors are considering putting their local tax rates up next year, according to a new study
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Some 18% of French mayors are considering increasing their taxe d’habitation and taxe foncière rates in 2023.

This is according to a study* published this week by the Association des maires de France (AMF) with the Centre de recherches politiques de Sciences Po.

Another 18% of mayors did not know what they planned to do, and 64% were not thinking of increasing local tax rates.

Reasons for which local authorities may put local tax rates up include the rising cost of energy and the gradual phasing out of taxe d’habitation for main homes. From 2023, this tax will only be applicable to second homes, which will result in a cut to local authority revenues.

The study also found that 90% of mayors were considering reducing the intensity and timetable of public lighting, 86% were planning to turn down the heating in sports facilities, and 81% were also planning this for public buildings.

With inflation affecting almost every type of goods and services, 40% of mayors were also considering cancelling or postponing recruitment drives, and 33% were prepared to cut spending on highways.

This comes after Paris mayor Anne Hidalgo announced that the capital’s taxe foncière rate will rise from 13.5% to 20.5% in 2023.

Read more: Paris taxe foncière rates to rise by 50% next year

Taxe foncière (ownership tax) bills are recalculated each year based on the amount that the property could in theory be rented out for – this is its valeur locative cadastrale (VLC) and an annual increase is applied to VLCs, based on the consumer price index.

To obtain the tax bill, the VLC is halved, to take account of expenses such as maintenance, insurance and repairs, and then this has a percentage rate applied to it which can be adjusted up or down on the decision of the mairie and/or intercommunal bodies.

It is this commune percentage rate which is set to increase from 13.5% to 20.5%.

The VLC of all properties is also set to increase by 7% next year in line with inflation.

Read more: Taxe foncière, taxe d’habitation: how are these worked out in France?

*The study was carried out on October 7 and November 8, having been sent to 34,950 mayors. 10.5% responded in full, 13.5% in part.

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