Rising number of French struggle to pay taxes

Households across France are starting to receive notice of how much they owe in income tax on their earnings but figures released on Tuesday show more people than ever are struggling to pay the tax man.

Rising number of French struggle to pay taxes
More and more French are struggling to pay their taxes. Photo: AFP

France has seen an explosion in the number of households requesting a deferral or cancellation of part or all of their tax bill in recent years.

The country’s public finance body, the DGFiP, says there was a 22% rise in the number of such requests between 2011 and 2013, from around 177,000 to more than 216,000.

Over the same period, the number of reminders for payment sent out by the French government has soared from 4.5 million to nearly 10 million.

According to Anne Guyot-Welke, from Solidaires Finances Publiques, a trade union for public finance workers, the freezing of tax benefits for single parents in 2011 meant that “many vulnerable households became taxable” for the first time.

“Many taxpayers in poverty are having difficulty paying their tax bills,” she told French daily Le Figaro. “This is also because of rising local taxes,” she added.

France has a global reputation for its high taxes. A recent study by liberal minded Brussels-based think tank the Molinari Economic Institute study found that the real tax rate for an average worker in France in 2014 stands at 57.17%, well above the EU average of 45.27%.

The French are also having to dedicate a larger portion of their earnings to paying off the taxes. The Molinari study found that the “day of fiscal liberation” for French workers – the day when they have earned enough to pay their tax bill for the year – fell on July 28th, two days later than the year before.

However some doubted the veracity of that study by an organisation that has been highly critical of France’s taxation policies. 

A separate study by Eurostat in June revealed that France had the third highest tax burden in Europe behind Denmark and Belgium.

The stagnating French economy is also taking its toll on earnings and on the poorest section of French society in particular.

As of 2011, the most recent year for which figures are available, about 14.3 % of the French population lived below the poverty line, 0.3% up on 2010 and a number that has been steadily going up since 2008.

And it could be about to get worse for many when this year’s tax bill lands through their letterbox. Despite a €350 tax rebate for low earners announced by the government in the spring, millions could see the amount they owe rise on last year, France’s BFMTV reported Tuesday.

It quoted Gilles Carrez, head of the French Parliament’s Finance Commission and member of the main opposition UMP party, as saying that between 12 and 15.5 million taxpayers can expect a bigger bill this year than last, thanks to a combination of various tax reforms.

by Sam Ball

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Timbre fiscal: Everything you need to know about France’s finance stamps

If you're doing a French admin task, you might be asked to provide a 'timbre fiscale' - here's what these are and how to get them.

Timbre fiscal: Everything you need to know about France's finance stamps

In France, you can buy  a very particular kind of stamp to cover the cost of a titre de séjour, or French passport, to pay your taxes, get an ID card if you’re eligible, or pay for your driving licence.

Basically a timbre fiscale is a way of paying a fee to the government, and some online processes – such as the tax offices – now have the more modern method of a bank transfer or card payment.

However there are plenty of official tasks that still demand a timbre fiscale.

In the pre-internet days, this was a way of sending money safely and securely to the government and involved an actual physical stamp – you bought stamps to the value of the money you owned, stuck them onto a card and posted them to government office.

They could be used for anything from paying your taxes to fees for administrative processes like getting a new passport or residency card.

These days the stamps are digital. You will receive, instead, either a pdf document with a QR code that can be scanned from a phone or tablet, or an SMS with a unique 16-digit figure. Both will be accepted by the agency you are dealing with.

Once you have the code you need, you can add this to any online process that requires timbre fiscaux (the plural) and that will complete your dossier.

You can buy them from a properly equipped tabac, at your nearest trésorerie, or online

Paper stamps remain available in France’s overseas départements, but have been gradually phased out in mainland France.