HomeEconomyThe government wants to replace it with a flat-rate deduction of 2,000...

The government wants to replace it with a flat-rate deduction of 2,000 euros: deputies restore the 10% tax reduction on retirees’ pensions

While the draft budget provides for a review of the tax relief enjoyed by retirees, deputies of the Finance Commission of the National Assembly eliminated the standard deduction of 2,000 euros to restore the 10% reduction in income.

New blow for the government. This Tuesday, October 21, the deputies of the Finance Commission of the National Assembly deleted article 6 of the finance bill (PLF) for 2026. This provided for a review of the tax relief enjoyed by retirees: it was about replacing the 10% reduction in income with a standard deduction of 2,000 euros.

Five amendments, presented by the republicans Corentin Le Fur and Laurent Wauquiez, Alexandre Duffosset of the National Rasement (RN), Éric Ciotti of the Union of Rights for the Republic and Mathilde Feld of France Insoumise (LFI), have put the brakes on this reform to restore the 10% tax reduction for retirees.

“Presented as a redistributive measure in favor of small pensions, this reform implies that more households lose than gain. Added to this are important secondary effects that could affect retirees with low incomes, starting with the modification of the resources taken into account for the calculation of housing aid,” the LR deputies propose.

But the benefit of the 10% reduction is “concentrated on the richest”, clarified the rapporteur of the general budget, Philippe Juvin (LR). “The last decile of income alone represents 30% of its cost and is also the third largest fiscal expenditure of the State, that is, 5.3 billion euros,” he stated.

The government wanted to increase the taxation of retirees to more than 20,000 euros of annual pension

Replacing the 10% reduction with a flat-rate deduction of 2,000 euros on income declared to the Treasury was a measure initially advocated this summer by former Prime Minister François Bayrou.

In this way, the former Matignon tenant considered that “benefits for professional expenses are not justified” for retired taxpayers. In fact, until now, retirees can deduct 10% of their income, up to 4,399 euros per year, in the same way as assets, when submitting their personal income tax return.

In a blog post published this summer, the Institute for Public Policies (IPP) considered that the standard deduction of 2,000 euros would benefit the less fortunate “quite a bit” if it is also applied to the calculation of housing aid. At the moment nothing has been decided. It now remains to be seen whether deputies will vote again to eliminate article 6 of the initial PLF during the examination of the text in public session.

Author: carolina robin
Source: BFM TV

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