Should we increase taxes to senior inheritance to clean public finances? At a time when the government is painting painfully providing France for a budget by 2026, this is one of the questions that still divides) the political class.
Already in June, Zucman’s tax was aimed at establishing taxes of at least 2% in the assets of more than 100 million euros had not approved the Senate test. Main argument of the opponents of this project defended by the left: the risk of seeing that the Ultra Rico flees from the country if they were attacked by such a measure.
A real threat? Several economists of the Economic Analysis Council (CAE) have investigated the issue by focusing on the behavior of 1% of the French with the highest income in capital (dividends, financial interests, rentals …), or 380,000 homes. Seeing these expatriate homes due to a too heavy fiscal burden is “a legitimate fear” knowing that it is “more likely to participate in a business activity, so it plays an important role in economic activity,” says CAE.
Ascending outputs but remain few
However, the organization attached to Matignon first observes the households with high income of capital are small and even less than the others: “Only 0.2% of the 1% more French are expatrian every year, half of when it considers the entire French population (0.38%).” The richest French who obtain their income from other sources than capital (labor, pensions …) are also more numerous to leave the country than high capital income (0.6% against 0.2%).
This does not mean that high inheritances are insensitive to taxes. On the contrary, the increase in capital revenues levies during the mandate of François Hollande in 2013 (abolition of the global sum tax, CSG to 15.5%) increased the initial rate of the French directed from 0.04 to 0.09 percentage points, according to the CAE. In the long term, the increase in the tax of a point would lead to a higher output of 0.02 to 0.23%.
On the contrary, the fall of taxes in 2017 and 2018 (abolition of the ISF, the introduction of the PFU) limited the tax exodus (the starting rate that decreases from 0 to 0.02 points) and the yields favored in France with a rate of yields of +0.01 to +0.04 points, an increase of 7 to 28% of the flows.
What impact on the economy?
This observation was now elaborated, CAE economists tried to measure the impact of the richest fiscal exodus on the French economy. First Education: The departure of a shareholder that controls at least 10% of a company penalizes its activity within five years that continue with a drop in the 15% billing, a decrease in the 31% payroll and a fall in the added value of 24%.
But these effects are often explained by the phenomena of business restructuring: “These structural changes are often accompanied by changes in the identifier of the legal entity of the company that explain its disappearance in administrative data. But these disappearances do not necessarily mean that the company’s economic activity disappears.
These effects are also partially compensated by “reallocation and balance” mechanisms. For example, employees who have lost their work can be reallocated to other activities or companies. Once all these elements are taken into account, the expatriation of a shareholder would prefer to reduce the billing of the company by 12.4%, the payroll of 13.3%and the added value of 21.3%.
Above all, these exits abroad are still “weak enough to have only a marginal effect on the French economy,” concludes economists. In the worst scenarios and taking as a hypothesis, a tax reform that increases the income of the State by 4 billion euros, the exodus of senior heritage would lead to a decrease in the total added value of the tricolor economy of 0.05% and a reduction of 0.04% of the total employment.
This is what makes it fall to say that “the public debate, by focusing on tax exile, is undoubtedly a goal.” Because fiscal exile is only an answer, among others, the increase in taxes on high heritage, and is certainly not the most penalizing, according to economists who consider that it is “essential to re -do the debate on the other margins of response of senior heritage to taxes, particularly in optimization strategies to escape taxes.”
Source: BFM TV
