Budget: towards a return of the housing tax?

As the government prepares to call on local authorities to help restore the country's finances, several elected officials have thrown a spanner in the works by calling for the return of the housing tax on primary residences (TH).

Gradually abolished between 2018 and 2023, this tax paid by tenants and owners brought in 23,8 billion euros to the State in 2020.

"The big mistake of the five-year term was the abolition of the housing tax (...). If we have to recreate a tax, it's this one," said the LR mayor of Meaux Jean-François Copé on LCI, while judging that it would be "the worst solution."

"We should imagine another form of tax," he qualified on Tuesday on Franceinfo, mentioning "a tax on residence" which would "cancel the existence of the property tax and the old housing tax", and which "would concern everyone except the most modest".

On the left, LFI MP David Guiraud tabled an amendment as part of the budget review to re-establish the TH on primary residences for the 20% of the richest households, but this is the only amendment to this effect at the Palais Bourbon.

"We sold people a dream, we told them 'you're going to pay less', but in fact, you pay with VAT," he explained on Franceinfo on Tuesday, refuting the idea of ​​a gain in purchasing power for the poorest, already exempt from housing tax.

"VAT money must go back to popular consumption and to supporting the French or our public services," he added.

The deputies have, however, tabled several dozen amendments targeting the housing tax on secondary residences, which notably authorise all municipalities to increase it, a possibility currently reserved only for "tense" areas.

"Universal contribution"

On the government side, Budget Minister Laurent Saint-Martin agreed on Monday that local authorities were "right" to question taxation.

But according to him, this does not necessarily have to involve the creation of a new tax, and "certainly not the return of the housing tax", which is "a gain in purchasing power", he dismissed on France 2.

The same goes for the Minister for Partnership with the Territories, Catherine Vautrin, who is "open to a debate on local taxation" but who refutes the idea of ​​a return of TH.

Asked by AFP, local elected officials agree that the abolition of the housing tax was a mistake, especially since, contrary to its initial intention, it also benefited the most affluent households by virtue of the principle of tax equality.

"Its removal was a demagogic measure. Demagogy pays electorally but it is paid for budgetarily, and the State compensated for the loss of 23 billion euros of tax resources with a deficit," says Jean-François Debat, interim PS president of Villes de France.

"The abolition of the housing tax has severed all fiscal ties between many residents and their municipality, and has largely destroyed the fiscal autonomy of municipalities," adds Antoine Homé, co-president of the finance committee of the Association of Mayors of France (AMF), judging that the communities themselves had "asked for nothing."

For Claire Delpech, a teacher at CNAM, "for years the State has been conscientiously destroying the link between local development and funding paid by local taxes."

But few elected officials take the step of resurrecting the TH.

"It would be horrible to recreate the housing tax. In relation to the French, it would be a denial of public speech," said former Budget Minister Eric Woerth (Renaissance) on Wednesday.

For its part, the AMF is calling for a "progressive universal contribution" with a reduction for those not liable to tax.

"It is not a question of re-establishing the housing tax, but of thinking about a citizen contribution to the public service", explains Antoine Homé, recalling that "it is not unfair or scandalous that all citizens contribute to the preservation of local public services".