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French Taxation

Local Property Rates in France 2016

Tuesday 04 October 2016

Local rates bills have remained broadly stable again this year compared to 2015, with the average amount payable by each household around €2,000.

As most readers will be aware, owners of residential property in France are liable for two local property taxes (or rates), called the taxe d’habitation and the taxe foncière.

The rates payable are based on the notional rental value of each property, a figure that is revised each year by central government, to which a locally determined percentage rate is then applied by the local councils (parishes, inter-communal councils and departments).

Accordingly, any change in the rates payable is made up of two components - the rateable value of the property (valeur locative) and the percentage rate (taux d'imposition) applied against this value; the former is decided by the government whilst the latter by the local councils.

This year the government imposed a 1% increase in the nominal rateable value of properties.

In contrast, according to an analysis carried out by the Forum pour la gestion des Villes et des Collectivités, most local councils have kept the lid on the percentage rate, with many leaving the rate unchanged.

Where the percentage rate has increased it has generally been as a result of an increase in the precept imposed by some departments, most of whom are facing substantial financial pressures arising from responsibility for the provision of certain social security benefits.

Amongst the largest increases has been in Nantes, where the taxe d’habitation increased by 6.5% and the taxe foncière 14.5%. In Marseille, the taxe d’habitation increased by 5.3%, and in Lille the councillors increased the taxe foncière by 10.6%, following on from a substantial 25% increase last year. Similarly, in Toulouse, the taxe d’habitation increased by 4.3% (12.3% in 2015).

In the current climate of austerity it is a major challenge for many local authorities to keep rate increases to a minimum due to the reductions in grant support from central government that are taking place.

The following table shows analysis of the average local rates payable in 2016 in the major cities and towns of France, which should provide a useful guide to what you might expect to pay wherever you own property in France.

The figures are those for a property having a rateable value of 1.5 times the average of all properties.

In principle, those owning a smaller than average property will pay less than is shown and an owner of a larger property will pay more. The figures shown are before any rate relief that may be granted to those on a modest income, or for other reasons.

The table shows that the town of Montpellier, in the department of Herault has the highest combined local rates. By contrast, residents of Paris pay the lowest, mainly because of the large sums the city receives in business rates, something of a national anomaly.

The table does not take into account the application of a 20% surcharge on the taxe d’habitation for second homes in a small number of municipalities.

TownTaxe d'habitationTaxe Fonciere
Le Havre€839
Le Mans€1,119€1,033
Source: Forum pour la gestion des Villes et des Collectivités.

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