Question 22078 — taxes and duties

Summary

Mr. Christophe Arend draws the attention of the Minister of the Economy and Finance to the consequences of the elimination of the specific standard deduction (DFS) in the 2020 budget for French companies and their employees. In order to finance the 5 billion euro reduction in income tax for households, the President of the Republic announced his wish to reduce tax loopholes including the DFS, which would allow the State to save 400 million euros in 2020. The DFS is a tax advantage used in fields of activity as diverse as construction, transport and the media. This niche makes it possible to lower the cost of labor for companies (deduction of 10% from the gross salary of their employees) and improves the employee's net salary by reimbursing workers' travel costs and the "basket premium" for lunch costs. Following Following this announcement, businesses are worried, in particular SMEs and VSEs in rural areas which would be the main ones affected. The National Road Transport Federation (FNTR) and the French Building Federation (FFB) speak of a “massive blow for businesses”. Furthermore, the reduction of the DFS could cause companies to lose other reductions in employer contributions, in particular the so-called reductions “Fillon relief”. Concerning the employee, receiving an income of 1,977 euros gross per month, or 1.3 SMIC, with 80 euros of professional expenses, the removal of the reduction would represent an increase of approximately 1,400 euros for the company and a loss of income of 170 euros net for the employee. Because of these fears, he asks how Bercy can guarantee that this measure will not have a major impact on the income of employees concerned and will not harm the vitality of these sectors of activity, in particular the booming construction sector.

Machine translation from French. The official text remains authoritative.

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