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A report on the overall tax burden in France reveals that the public authorities manage nearly 2/3 of French income. The rate of economic independence (disposable income) would actually be only 1/3.

French taxation beyond appearances

Compulsory levies, as calculated by the public authorities, are supplemented by hidden deductions.

The arsenal of hidden taxes, sitting on new tax bases do not appear as such to taxpayers. This ignorance thus reinforces the fiscal power of the state by promoting underground growth of the public sector in four ways:

The tax on the public debt

Public borrowing, that is, the carry forward of financing charges in the future, is the first of these bases. It easily creates in the public the illusion that the expenses it finances constitute transfers without compensation. Especially since it is difficult to know who actually weighs his load. It is spread over a large number of taxpayers who are not fully aware of the burden. The loan thus makes it possible to insensitively increase the volume of public expenditure.

The savings tax

Household financial savings provide the basis for another form of hidden deduction. By controlling the formation of lending and deposit rates, the State organizes an implicit and unrequited transfer of funds from savers to borrowers whose investment projects it claims to favor.

Public property income

Moreover, the formation and ownership of a State’s own assets enables the State to have resources without having to raise additional taxes. If, instead of transferring the income from this patrimony to its real owners – the taxpayers – the State keeps it in his hands, this operation is in fact equivalent to an implicit deduction. For a long time, public accounting has had to identify such revenues when they are monetized and collected. But these receipts are not considered as taxes and are not counted as such in the “compulsory levies”, which is ultimately to reduce – apparently – the effective rate of the tax burden.

The inflation tax on cash balances and securities

Inflation is a source of additional revenue for the state. It is at the origin of forced transfers of wealth that never appear in official statistics measuring the rate of tax pressure.

This tax has two origins: the non-indexation of the tax system, on the one hand, the creation of money and the issuance of public debt, on the other.

With regard to public debt issues, the mechanism is relatively simple: even if correctly forecast, inflation reduces the wealth of creditors – in this case the holders of money and government securities – and increases that of the State. The power of monetary creation of the State allows the latter to raise an inflation tax on cash balances. Similarly, its non-cash borrowings offer the opportunity to raise an inflation tax on the holding of government securities.

Errors by omission

The rate of “compulsory levies” relates the sum of the tax revenues and actual social contributions to the gross domestic product. But it does not take into account all the withdrawals of automobile gray cards or passports which are not recorded in the tax levies. Yet such royalties are just as mandatory as the payment of fuel duties when passing through the service station.

France “world champion” of compulsory levies

All these hidden samples conceal a reality revealed in a scientific study offering all the guarantees of objectivity and rigor achieved by high-level academics: “THE GLOBAL TAX PRESSURE IN FRANCE IN 1984” Certainly this report is already old and deserves a up to date, but it has so far never been contradicted and highlights the discrepancies between the official figures and the actual amounts paid by the French.

It is vain to obtain a tax relief if immediately arises another one that replaces it. In fact, the heart of the problem lies in the assessment of the overall tax burden suffered by all French.

The main purpose of this report is to provide the most reliable information possible to express the underlying reality without intervening in the public debate. And this, only in order to feed the reflection on the society in which the French live today.

Eric B


Report on the overall tax burden in France in 1984
"French taxation beyond appearances" by Jean-Jacques Rosa (Le Figaro)


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“The art of imposition is to pluck the goose to get as much feathers as possible before getting as little screaming as possible”. Jean-Baptiste Colbert