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French income tax cuts for poorest to last to 2017

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French income tax cuts for poorest to last to 2017
There was more good news for French tax payers on Monday, or at least the more hard-up ones. Photo: Joel Saget/AFP
12:28 CEST+02:00
A plan to exempt France's poorest households from income tax will not just be a one-off for this year, the government finance minister said this week. The income tax breaks will actually apply until 2017, the minister Michel Sapin said.

There was more cheer for the more hard-up tax payers in France on Monday when the finance minister Michel Sapin announced a government plan to apply the recently revealed breaks until 2017.

Sapin’s pledge comes days after French Prime Minister Manuel Valls made the headlines by announcing that the government plans to exempt 1.8 million households from the income tax burden.

Valls also said there would be income tax cuts for a further 1.2 million households, in what was seen as a move to try win back support from the disenchanted Socialist party voters and working classes.

Initially the PM suggested the tax cuts would be a one off and only apply to 2013 revenues that we to be paid in September this year.

But on Monday, Sapin said that the cuts would be written in to the 2015 finance bill.

“It’s not just a one-off measure for this one year, it is something that will apply to 2015, 2016 and 2017", Sapin told French media.

“There is a sense of injustice among French people who have had to pay more tax while their incomes have not risen,” Sapin added.

He, like Valls last week, insisted the tax cuts are not simply electioneering with the European elections set to take place this week.

Rogue tax payers to fund the cuts

The income tax breaks are set to cost the French government €1 billion a year and will be paid by money raised by rogue tax payers settling their bills with the French state.

Since France agreed a kind of amnesty of nationals who had hidden money in secret Swiss bank accounts over the years, the government has raised €764 million in extra revenue, Sapin revealed.

Authorities believe that number will swell to €1 billion by the end of the year. 

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