Billions of euros in lost profits for the state in favor of companies after a tax cut?

UNITED STATES, WASHINGTON (OBSERVATORY) — With its Budget Bill (PLF) for 2020, the government aims to lower the corporate tax rate (IS) to 25% for all companies by 2025. A drop that will result in a loss of 11 billion euros for the state, advance Les Échos.

The 2020 Finance Bill , scheduled for presentation on Friday 27 September, sets out the next two stages of lowering the tax rate for SMEs and large groups, according to differentiated trajectories, to reach a common rate of 25 %, reports Les Échos.

Thus, in 2020, this rate will be reduced to 31% for companies with a turnover (turnover) of more than 250 million euros, and 28% for those whose turnover will be lower. In 2021, the tax rate will increase to 27.5% and 26.5%, before being reduced to 25% for all businesses in 2025.

“This measure has a massive effect for businesses. In total, this will represent a total of 11 billion euros less over the entire five-year period,” says Bercy from the daily.

So far, this is nearly 2 billion euros less in the state coffers in 2018 and 2019. In 2020, a new level should be crossed, with a projected tax cut of 2, 5 billion euros, a loss that should eventually widen. There will still be 6 billion euros of decline, spread over the years 2021 and 2022, continues Les Echos.

The budget of France already deprived of billions of euros

On 23 October 2017, the deputies voted to abolish the solidarity tax on wealth (ISF), replaced by that on the real estate fortune (IFI), a shortfall of 3.2 billion euros for the caisses of the State, according to OFCE estimates.

Invited five months after this suppression in the TMC show to talk about his book, Francois Hollande ironically criticized his successor: Emmanuel Macron is he the “President of the rich”? “No, he is the President of the very rich.”


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