36% of town halls in France ‘to increase property tax’

More than a third of municipalities (36%) plan to increase their share of property tax property tax this year.

The information comes from a survey of 1,869 municipalities and intermunicipal authorities by the Association of Mayors of France (AMF).

In 2020, this figure was 7%.

The other municipalities expect nothing to change. The increase mainly concerns property tax the property tax, one of the last sources of revenue on which the municipalities can act, as well as the household waste collection tax.

Property tax is calculated by applying a rate voted by the municipality to half of the theoretical annual rental value of the property, e.g. 20% x (€4,000/2) = €400.

The survey also revealed that 29% of municipalities seek to reduce exemptions and allowances linked to property taxwhile only 2% did so last year.

AMF leader Philippe Laurent said that, among the municipalities surveyed, bills are expected to increase by an average of 2-3% (which equates to around 6-9% for municipalities actually planning to increase the rate). Usually, the bill also takes into account part of the tax which goes to the departmental councils, but this year, the money allocated to the departments also goes to the municipalities and suffers the increases, where they are planned.

The reasons for these increases include:

  • The pandemic which, according to Mr. Laurent, has not been fully compensated by the State: masks and gel, protective clothing and screens, cleaning, aid to businesses and a drop in revenue from canteens and crèches;
  • Total elimination in 2021 of housing tax for most main households, which, according to the AMF, has not been fully compensated in many municipalities;
  • A government policy of lowering local business taxes, which also go into municipal coffers.

According to the AMF, this increase is also linked to the desire of municipalities to maintain investment. Nearly 70% of small municipalities maintain their plans compared to initial estimates – 8% intend to invest more. The figures are 60% and 9% for large cities.

A spokeswoman for the AMF said: “Communities lost 6 billion euros during the Covid crisis. This is why, to revive investment, increases are necessary.

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