Photo credit: Fotolia
A few days ago, the Minister of Economy Bruno Le Maire announced in Les Échos a revaluation of the personal income tax scale of about 5%. Good news for your taxes. Explanations.
The income tax scale is regularly revised to take inflation into account.
This makes it possible to avoid making some families taxable until then not taxable, to tax more heavily the part of income spent in the high range or even to cancel some social or tax advantages whose thresholds are indexed to the income tax scale.
A 5% revaluation of the tax scale
In January 2022 the scale was thus increased by 1.4%, after 0.2% in 2021. But with the runaway inflation of recent months (5.80% yoy in August), the scale should be this time raised by 5%, a rare rate of revaluation. “The revaluation will be based on the level of inflation in 2022, around 5%”, said a few days ago Bruno Le Maire, Minister of Economy, in the daily newspaper Les Échos.
This 5% increase will have to be included in the budget law for 2023 which will be presented to MEPs at the end of September. If voted on, the new scale will be used to calculate the income tax received in 2022.
How could the new ladder be?
The scale includes 5 brackets, each corresponding to a fraction of the taxable income for one share. The current scale, applicable to 2021 income, is as follows:
Tranche 1: <10,225 euros - Tax rate: 0%
Tranche 2: between 10,225 and 26,070 euros – Tax rate: 11%
Tranche 3: between 26,070 and 74,545 euros – Tax rate: 30%
Tranche 4: between 74,545 and 160,336 euros – Tax rate: 41%
Tranche 5:> 160,336 euros – Tax rate: 45%
In the event of a 5% revaluation, the new scale, applied to 2022 income, could be as follows:
Tranche 1: <10,736 euros - Tax rate: 0%
Tranche 2: between 10,736 and 27,373 euros – Tax rate: 11%
Tranche 3: between 27,373 and 78,272 euros – Tax rate: 30%
Tranche 4: between 78,272 and 168,352 euros – Tax rate: 41%
Tranche 5:> 168,352 euros – Tax rate: 45%
The tax entry threshold would therefore go from € 10,225 to € 10,736: taxpayers who received a taxable income of less than € 10,736 in 2022 would therefore not be taxable.
A tax cut for some taxpayers
For some taxpayers, this reassessment of the scale will be synonymous with tax cuts. For example, a single childless taxpayer who receives a taxable income of € 26,500 will no longer be taxable in the third installment and will therefore see his / her tax reduced by € 138.