Property tax: a significant increase is expected for 2023

The cadastral rental value has been revalued for the year 2023. It would seem that the planned increase in property tax is 7.1%.

If you own real estate, then you are probably familiar with the Harmonized Index of Consumer Prices (HICP). It should then be noted that this base, calculated by INSEE, is used as the basis for calculating your property tax. Also note that this calculation does not take into account the cost of housing for owners. Recently, the HICP base has experienced a revaluation . This increase was therefore announced by INSEE, +7.1%. What you need to understand by this is that if your city does not change its tax rate, then your property tax will increase by more than 7%. It should therefore be noted that during the examination of the 2023 budget, the government had mentioned the desire to limit this increase. However, upon reflection, the government has chosen to leave control entirely to the municipalities. We'll explaine everything here !

Cadastral rental value

The HICP, the harmonized index of consumer prices, has an impact on the property tax every year. It should be noted that since 2018 the cadastral rental value has an important role in the calculation of this tax. Indeed, the theoretical rent, or cadastral rental value, serves as the basis for calculating the property tax. Thus, every year, this base is subject to a revaluation. And this, depending on many conditions, such as inflation and the HICP. Thus, the property tax varies every year according to the harmonized consumer price index for the month of November.

It should then be noted that last year the property tax base had already increased significantly. Indeed, knowing that the HICP was 3.4%, the property tax has increased. The reins are then in the hands of local authorities . Indeed, the latter must respectively decide on the tax rate of their municipality, inter-municipality or department. According to the figures mentioned by the National Union of Property Owners (UNPI), last year the property tax increased by 4.7% on average.

Property tax: an increase of more than 7.1%?

At the moment it seems impossible to define the tax rates voted by each municipality for the year 2023 . It should all the same be known that if the local authorities do not decide to lower their rate tax , then the property tax will increase by +7.1% in 2023. But that's not all ! Indeed, if the municipalities or departments decide to increase this rate, then the increase could become even higher. INSEE has therefore published the new definitive harmonized consumer price index. And this, for the month of November 2022. It was therefore calculated at 7.1%. Indeed, this figure constitutes the rate provided for in the official texts for the annual revaluation.

During the discussions on the finance bill for 2023 , the deputy centrist, Charles de Courson, unveiled an amendment. The latter was intended to limit r the annual revaluation cadastral rental values ​​at 3.5% . However, after the use of 49.3, this amendment was not retained. It should also be added that Gabriel Attal, the Minister in charge of Public Accounts, had expressed his opposition to a limit of 3.5%. Indeed, the latter then wanted to give the reins to the municipalities. And this, to decide on the increase in the property tax. ' I call on communities not to blow up their local tax rates. Not to crack all the efforts that are made to protect the purchasing power of the French. Communities can completely lower their municipal rates . A number of mayors have announced that they will ».

Source : MoneyVox