C3S, CFE, CVAE… These barbaric abbreviations, all entrepreneurs and business leaders know them by heart. They belong to the large family of production taxes: obligatory payments, regardless of the amount of profit obtained, “on the production and importation of goods and services, the use of labor force or the use of land, buildings and other assets used for production purposes”, according to the INSEE definition.
Macron wants to abolish the CVAE after the housing tax
After cutting them by 10 billion euros at the end of 2020 and then at the end of 2021, presidential candidate Emmanuel Macron wants to cut production taxes further. How ? By abolishing the contribution to the added value of companies (CVAE) for all companies involved. The CVAE is payable by any natural or legal person whose turnover exceeds EUR 500,000 excluding tax. Any associate of a professional civil society and resource or any member of a group of liberal professions with a turnover exceeding EUR 152,500 is also liable.
And this, while the CVAE brings 7 billion euros to the local blocs – municipalities and intermunicipal companies – and departments. “They are reimbursed to the nearest euro”, promise, at the TribuneLaurent Saint-Martin, Member of Parliament (LREM) for Val-de-Marne, general budget rapporteur to the National Assembly and local tax relay for the campaign team.
Especially since the debate is still raging between the associations of elected officials and the executive over the housing tax compensation, which was abolished for 80% of tax households in 2018 and permanently removed in 2023. According to the Association of Mayors of France, 6,000 of the 35,000 municipalities have not received and “will not receive” full compensation, while, according to Emmanuel Macron, “it was compensated in accordance with the commitments to the nearest euro”, he had hammered at the congress of mayors in November 2021.
“The abolition of the housing tax, beneficial to the French, could indeed destabilize the local political landscape in the beginning,” today recognizes Laurent Saint-Martin. †lThe priority is not to restart a project, but to clarify the powers and stabilize the rest of the local taxes”, adds the presidential candidate’s spokesperson.
The word “contract” has become taboo
In the absence of an important law on the revision of local taxes, as announced by the Philippe government at the beginning of the five-year term, “the contracting process will be reopened by the next government if the president of the republic is re-elected”, announced early March at The Gazette of the House of Commons, Olivier Dussopt, Minister of Public Accounts and Emmanuel Macron’s Support.
As soon as it was spoken, this statement hit like a bomb with local elected officials. The latter recall the announcements made by Prime Minister Édouard Philippe in Cahors in December 2017 about the contracting between the state and the 322 richest communities – regions, departments, intermunicipalities and municipalities – about their operating costs. Until Covid-19, these areas had made a commitment to limit the latter’s increase, in return for stability in their overall operational allocation.
Today, even when the amount of 10 billion euros is advanced here and there, the presidential candidate’s team refuses to speak of contracting or cutting back on local authorities.
“These are not cutbacks or cuts in staff, but controlling the pace of their operating costs. Central government and the local authorities should sit around the table to support this process as best as possible“, To explain Laurent Saint Martin.
†We are the first majority not to cut the General Operating Grant (DGF) to local governments. We have kept it and even increased it,” said Emmanuel Macron’s spokesman.
Le Pen wants to get rid of the CFE and a little bit of the C3S
For its part, the National Rally (RN) candidate wants to play on local taxes to favor VSEs SMEs, “the source of tomorrow’s jobs, the best lever for territorial anchoring, the” heart by [sa] economic policy”. For example, Marine Le Pen wants to abolish the company property contribution (CFE). The CFE is payable in every municipality where a company has premises and land, the companies and natural persons who exercise an independent professional activity and whose turnover or receipts are greater than or equal to 5,000 euros.
Second project: the abolition of the social solidarity contribution of companies (C3S), which, she writes in her programme, “reserved for moving areas”. The C3S participates in the financing of old-age insurance and any company, private or public, with a turnover of more than 19 million euros.
the snag in the grass: The RN candidate does not yet say how these deletions will be compensated, nor by what they will replace.