The most famous of taxes "has grown old" and no longer fulfills its function of redistribution according to the Court of Auditors which calls for a reform "ambitious". The Court of Auditors and calls for reform "ambitious" tax on income.
A tax reform should tackle all taxes on property, but also, even more importantly, the income tax, which has aged and contributes less to reduce inequality, according to the Council of compulsory levies (CPO). Coincidence? This body attached to the Court of Auditors, which brings together experts, senior officials and magistrates, on Wednesday released its report on the levies on households, the day the government introduced its reform of the taxation of wealth, which will remove the shield and reduce the solidarity tax on wealth (ISF).
The ISF has elements of modernity "as it is" progressive ", has launched the first President of the Court of Auditors, Didier Migaud, members of the Committee on Finance, who with their colleagues in the Senate, had commissioned the report. According to the former Socialist MP, defects of the wealth tax are "his base too narrow" – less than 2% of households are indebted, while the art and business assets are exempt- – and interest rates "too high".
The government wants to lower rates but does not solve other problems. His project reduced even more than half the number of payers. Moreover, argues the imposition of the rue Cambon, a tax reform heritage "would benefit from business globally" and include taxes. But this is not the most urgent. The CPO and calls for reform "ambitious" from the income tax (IR).
Half the homes are not taxable
The most famous of taxes has become so "complex" and its shortcomings so "obvious" that the time is no longer simple "changes," say the authors of the report: it should be "refound" even if it s 'proved too complicated, "make it disappear and re-create a progressive tax-based." The finding is similar to a death certificate. The IR "has aged," "revenues are now weak" and "it just more and more to fill (…) goal of progressivity and redistribution," it was "historically" assigned, summed Didier Migaud.
Its woes are legion: half of the homes are not taxable revenues represent only 2.6% of GDP. This is the lowest yield among the rich countries.This loss of progressivity, which has "benefited" the most affluent, is linked to the proliferation of tax loopholes and lower rates that make tax less burdensome than in Germany or the United Kingdom. Finally, the RI income tax less than the heritage work, without this being justified by a concern for fairness, says the CPO.
So, it "becomes regressive" for a few thousand wealthiest taxpayers, whose income comes largely from heritage: their tax rate is lower than for those who are a little less rich. The report focuses on family and conjugal quotient, designed to tax households with fewer children and not to penalize couples where one spouse does not work. But the CPO said that these "exceptions" French prevent a stronger redistribution between rich and poor, and stresses "the trend towards individualisation of IR" in other countries.
The finding on income tax is even more alarming that "the tax and benefit system is globally become more progressive" since 1990 and is "relatively effective" in terms of redistribution, the report said. The CSG has "played a key role" in this improvement, says the CPO, which boasts of its qualities in relation to IR. Water to the mill of the Socialist Party, including a flagship proposal for the 2012 presidential election is the fusion of these two taxes.