The observation is well known, it is confirmed year after year: the tax shelters granted to individuals and companies are very expensive for public finances, without it being possible to regulate them or conclude that they are fully effective. This is what emerges from a twenty-page note from the Court of Auditors, published Thursday, July 6. Entitled “Managing and evaluating tax expenditures” (another name for tax loopholes, i.e. all the tax advantages and tax reductions that are current in France), this thematic note is part, with eight others, of the contribution of the Court to the spending review launched by the Minister of the Economy, Bruno Le Maire, in order to prepare the 2024 budget. At the end of June, he announced that he wanted to carry out “at least 10 to 12 billion euros in savings” on this occasion.
“There is no guarantee of the quality or suitability [des niches fiscales] to the objectives set », underlines the note, which indicates that in ten years, these expenses have jumped by more than 20 billion euros. The 465 existing tax loopholes totaled 94.2 billion euros in 2022, compared to 72.1 billion in 2013, with a peak in 2018-2019, due to the weight of the employment competitiveness tax credit (subsequently transformed into reductions in social security contributions).
On the other hand, the weight of tax loopholes in relation to GDP has hardly changed (3.6% last year against 3.4% ten years ago). They are also very concentrated: 90% (in amount) of niches on income tax, corporate tax and VAT. “These expenses, which reflect, in hollow, the very high level of taxation in France, come to mute the yield of taxes”, underlined Pierre Moscovici, the first president of the Court of Auditors, Thursday. ” It’s an easy way out.”according to him.
And this, even though it is a question of expenses said “counter”, therefore uncontrollable: nothing sets an envelope or a ceiling in the finance bills, for the research tax credit (CIR, 7.4 billion euros in 2022), for the credit for tax for competitiveness and employment (6.4 billion) or the tax credit for the employment of an employee at home (4.8 billion), to name only the three most important tricolor tax niches. Of the 465 existing devices, 24 cost more than one billion euros to the State.
A “sea serpent” of public finances
Gold, “the effectiveness of this spending is hardly evaluated”, recalled Mr. Moscovici, calling for “much more rigorous management”. The new European rules supposed to come into force next year should, he hopes, help by integrating tax loopholes into the overall expenditure indicator. Thus, for several niches (reduced VAT rate for commercial catering, for example), the number of beneficiaries is not even precisely known.
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