“It is out of the question that employees, that French people pay more income tax or enter the income tax scale because of inflation (…). I want to remove this concern”. Here is what Bruno Le Maire assured this Wednesday, June 8 on BFMTV. If the sharp rise in prices, which should continue until the end of the year, leaves room for uncertainty, the income tax scale will indeed be revalued in line with inflation (excluding tobacco) in the finance bill for 2023 (PLF2023). – It will be applied for the 2022 income tax.
Taxpayers can be reassured: there will be no unpleasant surprises in 2023, linked to the absence of indexation. Because, as Bercy reminded us, the latter could have three major consequences: “It would make certain households which until then had not been taxed liable to income tax; would lead to the taxation of certain incomes at a higher rate, at the title of a higher bracket; and would result in the loss of the benefit of certain social or tax benefits, the thresholds of which are indexed to the income tax scale.
To find out what figure will be used when the finance bill is presented in September, you have to wait until the end of June. It is at this time that INSEE will reveal, in its economic report, its estimate of inflation for the year 2022 in France. First valued at 4.5% YoY last March, forecasts jumped to 5.4% YoY in June (between June 2021 and June 2022).
The revaluation of the income tax scale should therefore reach at least 4% (as for that of pensions next July). What could be the different slices?
The indexation of the IR scale could however exceed this threshold, because it produces “no additional cost for public finances”, according to Bruno Le Maire’s cabinet.
As Capital reports, here is what the new 2023 scale could be, revalued by 4%, applicable to income collected by households in 2022:
How much can you save on your tax bill?
If we take the example of a single person without children, details the economic magazine, who declared a net taxable income (after 10% deduction for professional expenses) of 26,000 euros, the gains would be significant. By being taxed at 11% on 15,775 euros (26,000 – 10,225), this taxpayer will have to pay 1,735.25 euros in tax to the Public Treasury.
By imagining that he could reach the threshold of 27,000 euros of net taxable income (after 10% deduction for professional expenses) in the spring of 2023, here is what he could save with a fictitious revaluation of 4% of the scale of the income tax: he would remain taxed at 11% on 16,366 euros (27,000 – 10,634) and would therefore have to pay 1,800.26 euros in 2023. He would thus earn 213.99 euros, compared to a non revaluation which would have changed it to an IMR of 30%.