Between 2010 and 2020, the property tax increased by 27.9% on average across the country. But this rise should continue in 2022. In question, the revaluation of 3.4% of the cadastral rental bases, caused by inflation. And for some municipalities, the increase could still be much higher.
It’s a complex accounting operation that will hurt homeowners in 2022. At issue: inflation. In fact, since 2018 and the abolition of the house taxThe cadastral rental values (meaning the amount of the theoretical rent) of the dwellings, which serve as the basis for calculating the tax on real estate, are readjusted every year, according to the Harmonized Consumer Price Index (IPCA).
To be clear, if inflation rises too high, this is not good news for homeowners, who will see their property tax increase faster than the rate of rent increase.
And the context does not favor them, due to the war in Ukraine and the post-Covid-19 economic recovery, counting on INSEE inflation at 4.5% in March 2022. Result: The property tax should increase considerably this year, throughout the country, to the tune of 3.4%, unprecedented in thirty-three years.
Who pays the property tax? Who is exempt?
As a reminder, any person, whether natural (individual) or legal (company), is subject to property tax payment as soon as he/she owns a built property (housing, factory), or unbuilt property (agricultural land, pond ). Even in the case of a rental, the notice is sent to the landlord. Likewise, the latter cannot demand a refund from the tenant, with the exception of the part allocated to the household waste collection tax (TEOM).
There are only a few exceptions to the property tax exemption. If you are a beneficiary ofdisabled adult subsidy (AAH), if you are over 75 years old and if you are the holder of Aspa or Asi (additional allowance for disability), you can request total exemption, provided that you do not exceed the reference tax income. However, this gain does not affect the TEOM, for which you will be responsible. It should also be noted that rural buildings for agricultural use are not affected by the property tax, as are new constructions or new construction, allowing property tax exemption for two years.
+5% in Dijon, +15% in Tours
According to a study by the National Property Tax Observatory, property tax increases have been very uneven throughout the country in recent years. Nantes (Loire-Atlantique) shows the strongest increase, with 38% between 2010 and 2020, that is, almost 10 points above the national average (+27%). On the contrary, it only increased by 14.9% in Montpellier (Hérault) or 11.1% in Caen (Calvados).
This very heterogeneous trend should continue by 2022. For example, the property tax increase will amount to 5% in Dijon (Côte-d’Or), 6% in the urban community Grand Paris Seine & Oise (Yvelines) or even 15% in Tours (Indre-et-Loire), or even Montreuil (Seine-Saint-Denis) or Amiens (Somme).
Municipalities rub their hands
As the property tax is a local tax, the municipalities can see your endowment increases. Thus, some justify the increase of a logic of development of public services.
It is the case of Strasbourg (Bas-Rhin), which explains an increase of 12.6% through new investments in energy transition. In this case, three tram lines and a network of intermunicipal cycle paths will be developed. Inside the parisianPia Imbs, president of the Strasbourg Eurometropolis, indicates “this represents an additional 65 euros per year for individuals”, but it is “a marginal contribution, since we estimate that taxpayers were going to benefit from 600 euros of equivalent public services in addition to of the year”.
did you know
the #owners contributed to the financing of local facilities and services for more than 35,000 million euros through the #property tax and for €13 billion through mandatory transfer rights in 2020. pic.twitter.com/jseBmTRxld
— UNPI France • 25 million owners (@UNPI_FR) October 21, 2021
The property tax remains a good source of cash for municipalities. Always according to the National Observatory of Taxes on Real Estate, its total amount reached 35,300 million euros in 2020, compared to 23,500 million in 2010, an increase of 50% in ten years.