Income tax will be reduced for the year 2023. An announcement made by the government has just fallen!
Following the financial crisis and the uncontrollable inflation in the country, the government proposed to the Council of Ministers, a new scale. A device which aims above all to reduce the tax on the income of the French. This new indexation will be in effect for next year. Income tax will be paid on your earnings.
The income tax for the year 2023 will relate to the income of the year 2022. So, for people who had more income this current year will see the calculation from another angle.
And like income tax is calculated annually, so it may vary from year to year . For the coming year, the indexation on the rise in prices on inflation is 5.4%. Moreover, the government confirmed it, this Monday during the presentation of the 2023 budget.
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For next year, according to the Minister of Economy and Finances Bruno Le Maire, there would be more or less six billion euros in taxes deducted for all taxpayers, if they did not make this decision.
This may seem difficult to understand knowing that the objective is to lower taxes. But the procedures and the calculation turn out to be quite simple.
The revaluation of the scale for the tax relates to the totality of the incomes of the previous year . In order to see more clearly in the explanation, it is necessary to make a comparison of the 2022 scale with the scale for the year 2023.
If in the year 2022, an individual receives an income that is less than 10,777 euros for the whole year, there will be no tax rate. The individual will therefore not have to pay tax on the revenue .
If the income is between 10,777 and 27,478 euros, a tax rate of 11% will be payable. A tax rate of 30% will be payable for income between 27,478 to 78,570 euros. 41% for income between 78,570 to 168,994 euros. And finally, 45% for income exceeding 168,994 euros.
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For the year 2023, after the revaluation of the tax, here is the new scale . Annual income not exceeding 10,225 euros will be non-taxable. 11% for income between 10,225 and 26,070 euros. 30% for income between 26,070 and 74,545 euros. 41% for income between 74,545 and 160,336 euros. And finally, at more than 160,336 euros, the tax rate will be 45%.
Like every year, income tax is determined based on the average of inflation . A practice that is not likely to change! What the government is proposing to us here is far from being a revaluation which aims to reduce the rate fiscal .
What would have been interesting for income tax would be to freeze the rate for several consecutive years. This would allow us to see concrete results. Otherwise, it will only be a new calculation. It will therefore be necessary to be vigilant in the face of this scale in order to better prepare you to pay your taxes!source: foozine.com