Inflation is falling and slowing in France. According to INSEE, the consumer price index (CPI) in November stood at 3.4% over one year (-0.6% compared to October 2023). If the trend revealed by this indicator is good news for most consumers in France, it is also bad news for the 32 million taxpayers subject to property tax. In question, another indicator: the harmonized consumer price index (HICP). And it is he who has an impact on the amount of the 2024 property tax.
Indeed, since 2018, a rule requires that cadastral rental values be revalued following the HICP recorded over one year (between November of the previous year and that of year N-2). This figure, which must be confirmed in mid-December by the National Institute of Statistics and Economic Studies (Insee), during a revision, must serve as a reference for the publication of the revision coefficient of the calculation base for built properties. and unbuilt (excluding professional premises), as Le Figaro rightly explains.
According to preliminary data, published on November 30, the evolution of the harmonized consumer price index (HICP) in November 2023 is 3.8% compared to that of November 2022. Consequently, the coefficient of revision should be of the same level. If this increase is bad news for owners, it is however less strong than the flat rate increase for 2023 which was 7.1%.
However, the 2023 property tax actually paid by taxpayers had jumped well beyond inflation. In question, the increases voted by local authorities, to finance their expenses. Among the most impressive, Paris and its 44% increase. And she’s not the only one. Around 15% of French municipalities have increased their rate in order to increase their budget.
Enough to make the National Union of Real Estate Owners (Unpi) jump, which speaks of “inequity”. Because the base is indexed to this HICP “which increases faster than inflation”. Because, since the elimination of the housing tax (compensated by the State for communities but which is no longer collected directly), the last tax lever is based on the property tax, details Le Midi Libre.
With this third increase in three years, “we are seeing an increase almost four times greater than the increase in rents of 6.7% in ten years”, saddens Sylvain Grataloup, the brand new president of the UNPI. Other figures are dizzying. For example, after three years of very significant increases in bases, the increase is around 15%: unheard of in 30 years.
The worst part of all this is that the future increase for 2024 is rather “bad news” for many communities who were hoping for a stronger increase, of the order of 4.5 to 5%. According to Pascal Heymes, many communities, when preparing their budget, observed a “HICP of 5.7% in September, but it has fallen sharply in two months. In view of the context, 3.8%, this “is not ultra-shocking. Some elected officials that I advise are even disappointed. I do not exclude that many are tempted to touch the rates to cope with the costs linked to inflation”, he explains for the daily regional.
Consequently, owners will continue to be heavily taxed. “They finance, alone, the increase or the need for additional revenue from local authorities, which is a drawback of the abandonment of the housing tax,” concludes Pascal Heymes.