“The debate on the level of mandatory deductions is valid if it affects the choices that are under it”

2024-10-02 04:40:04

Lhe debate between the right and the left focuses mainly on taxes. For some, we must avoid eating them, France is the European leader in the level of mandatory deductions, which is true. Any increase would harm the competitiveness of the economy and encourage tax evasion by the wealthiest.

On the contrary, a reduction in these taxes will increase growth, lead to a reduction in unemployment and thus generate new resources for individuals, businesses and the State, in a virtuous environment.

For others, it is important to strengthen the resources of public services, to improve the expectations of our fellow citizens. So we must increase the revenues, by increasing the tax pressure on the better. In the eyes of the proponents of this approach, selection and moderation will have negligible negative effects on investment, and thus on competitiveness and growth.

On the contrary, increasing public spending and improving public services will have a positive impact on the economy. The following budget discussion risks being a discussion of the deaf between the proponents of these two approaches. However, it is not certain that the rules of the debate are well established.

Be careful with comparisons

First, we must be careful about comparison. Therefore, in France, additional pensions are considered mandatory contributions, because it is a mandatory procedure at the national level by the Government. In many countries, the supplementary pension system is defined at the level of each professional category, through collective agreements… and therefore does not consider the mandatory deduction, even if it is mandatory for companies affiliated to the professional category and for them. workers.

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Add to your selections

But, above all, there is no mechanical link between the level of compulsory taxes and competitiveness. Denmark has a very competitive economy: exports represent 32% of GDP; The trade balance has been increasing for decades. And yet, compulsory deductions are high, 42.5% of GDP, especially income tax (IR), so criticized here: it represents 24% of GDP, compared to around 4% in France, 9.5% of we add to the IR. CSG which, however, is a relevant tax, unlike income tax.

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