Currently, overtime is tax-exempt up to a ceiling of 5,000 euros per year, with a maximum of 220 hours worked over a year. All this, excluding branch, company or specific collective agreement.
To respond to an expectation of the right of the Republicans, Bruno Le Maire, the Minister of the Economy said he was ready this Friday to study new measures on the tax exemption of overtime during the debate in parliament in the coming weeks on the package of measures dedicated to purchasing power.
“When we look at the issues of overtime, tax exemption, is there still room for manoeuvre? Why not, ”he said on Franceinfo.
And to add: “We are exactly in line with our project which is to value those who work and better remunerate those who work”, added the Minister.
Caution
This measure is also requested by employers. The Confederation of SMEs has already asked to reduce employer contributions on overtime.
The fact remains that this measure could be both costly for the State budget with around three billion euros in revenue less according to an OFCE study before warning: “On the one hand, there is a positive impact: the fall in the cost of labor would encourage companies to increase the working time of existing employees, who would see their purchasing power increase thanks to overtime pay. But on the other hand, there is also a negative impact: the fall in the cost of overtime would indeed encourage entrepreneurs to extend working hours, thus favoring internal employees to the detriment of the unemployed”.
On a completely different matter, Bruno Le Maire also recalled the government’s openness to modifying the system provided for compensating those who use their vehicle to go to work. At this stage, the government project provides for compensation of between 100 and 300 euros depending on the level of income and the distance travelled. “Should we go further on the income concerned or less far by concentrating the effort, that, I find that it is a particularly useful debate and we will be able, I confirm it to you, to improve this system together”, added the minister before the Senate Finance Committee this Friday morning.