Last December, the vote on the finance law approved an increase in the property tax for all households. The deputies have, in fact, voted a fixed revaluation of the cadastral bases of 7%. This revaluation is calculated from the consumer price index, between the months of November 2021 and 2022, according to UFC-Que Choisir. This is why, in the context of inflation, it jumped from 3.4% in 2022 to 7% in 2023.
This increase in rental bases will also increase property tax since they are used in the calculation of the property tax on built properties (TFPB). It will therefore directly impact households.
In the context of general price increases, municipalities will benefit from the flat-rate revaluation of cadastral rental values to build their 2023 local budgets. The revaluation should represent nearly 3 billion additional euros, in total, for communities.
A sum that will be of great use to them in these times of inflation. Indeed, households are not the only ones affected: local authorities have also seen their budgets explode. According to our Capital colleagues, in Rennes and Toulouse, for example, the increase in energy costs amounts to 400% and 500%.
However, despite the state aid schemes, the increase in these costs threatens the budget of the municipalities. Unlike the State, local authorities must vote for a balanced operating budget without borrowing. Some municipalities could therefore, from this spring, increase their property tax to support their budget.
Some property owners will see their property tax increase more than with the flat-rate revaluation of the cadastral bases alone. The municipalities could decide to increase it independently of the 7% revaluation.
According to UFC-Que Choisir, property tax is one of the last important tax levers in the hands of town halls. Indeed, since the abolition of housing tax on main residences, municipalities have lost one of their sources of revenue.
About 20% of municipalities should consider increasing their property tax to bring their budget to balance as of spring 2023. However, this does not mean that 20% of municipalities will definitely increase their property tax rate.
The increase in rental values also applies in the calculation of other local taxes, such as the housing tax on second homes and the tax on vacant housing (TLV). The municipalities will therefore benefit from two other cash inflows linked to the revaluation of rental values.
Some communities could also choose to increase the housing tax on second homes, independently of the revaluation, or to increase the Gemapi tax for the maintenance of aquatic environments.