Budget 2018 : two small gifts to the finance

Finance is clearly not “the true opponent” of the government of Edouard Philippe, who holds on the contrary, in his first budget, to delete the most “anti-finance” under François Hollande. As early as last July, the Prime minister had announced a series of measures to enhance the attractiveness of the financial centre of Paris, in the context of the Brexit : among them, the removal of the increased rate of 20% on the last tranche of the tax on wages, particularly in the banking, financial and insurance.

The tax on wages payable by the employers of the sectors which are exempt from VAT, had been increased in 2013, with the establishment of a new tranche relating to the gross remuneration annual exceeding 152.279 euros. “Taxation specifically French” highlights the record of the government press. These big wages will be effective January 1, 2018 taxed at 13,60%.

“This provision […] will reduce significantly the tax burden on employers,” argues the government, which stipulates : “the economy for the businesses of the removal of the increased rate of tax on salaries is estimated at 140 million euros in 2018.”

This will lead to a shortfall in annual tax by the same amount.

Tax on stock exchange transactions at the day-to-day

Other tax emblematic of the previous quinquennium, the one on financial transactions (TFF), which relates to the purchase of shares of a French company whose market capitalization exceeds a billion euros, Accor, Zodiac, passing by Hermes, Iliad/Free, L’oréal or Society in General (see the list).

Increased by 50% in the last year, this tax inspired by the Tobin tax, which netted the State some 947 million euros in 2016, up from 1.058 billion in the previous year, is not removed, or even reduced to the initial rate of 0.1% or 0.2%. However, its extension to transactions infra-day (“intraday”), that is to say initiated and performed in the same day, which was to enter into force on the 1st January next, is hereby repealed.

The Court of Auditors had drawn up this was a balance sheet to be very critical of this tax, which “has only shifted in other countries,” the operations referred to. The Sages of the rue Cambon had considered that the extension of the plate to the intraday “faces significant challenges to implementation”, especially for defining the chargeable event of the tax when there is no transfer of ownership of the securities. The government reminds us of this technical point, but this is not his motivation :

“The removal of this extension is expected to strengthen the positioning of the place of Paris as a financial centre of reference in Europe”, makes sense.

In July, the associations were raised against this shot of a plane on the TFF.

“Emmanuel Macron sits down on a tax that would bring in each year 2 up to € 4 billion in France and $ 22 billion in Europe. A fortune which would have enabled it to meet its promises to fight poverty and climate change, ” was especially denounced Oxfam France.

The two measures are presented by the government as contributing to “increase the economic attractiveness of France and to reinforce the positioning of the place of Paris as a financial centre of reference in Europe”, in the objective of “promoting the relocation or the establishment in France of high value-added activities and the recruitment of foreign executives with strong potential for the French companies.”

The government recalls that other provisions of “attractiveness” that are not directly part of the tax, are foreseen, in particular the exclusion of bonus deferred in the calculation of severance pay.

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