What if France was an unknown tax haven for the middle classes? While the government is hard at work preparing the 2024 budget, these households “too rich to be helped and not rich enough to live well”, in the words of Emmanuel Macron, hope to see the tax pressure drop in the near future. . Last May, the Head of State had in fact promised a strong gesture, in times of budgetary lean times: two billion euros returned to “French men and women who work hard, […] and who, because the cost of living has increased, they are having difficulty making ends meet.
Published last July, a study by the German IFO institute, however, puts into perspective the feeling these middle classes have of being bludgeoned fiscally. It compares the tax rate of these households in 27 European countries. Their calculations are based on European Union income statistics (EU-SILC), and more precisely, on 2019 income. Belonging to the “middle class” corresponds, according to the researchers, to a disposable income – in other words, the initial income “increased by social benefits received and reduced by taxes paid” – between 75% and 200% of the national median income.
The whole was subdivided into three subcategories: lower middle class (75% to 100% of national median income), middle middle class (100 to 150%) and upper middle class (150% to 200%) . In France, if we consider the data used by the study, the lower middle class has an annual disposable income of between 16,921 and 22,562 euros per year, the intermediate middle class between 22,562 and 33,842 and the upper middle class, between 33,842 and 45,124 euros.
To calculate the tax burden of the middle classes, several family configurations are taken into account by researchers: single with one income, family with one income with two children, family with two incomes and two children… First lesson: in all cases In appearance, France does not stand out for its high tax burden, on the contrary. French families with two children and a single income belonging to the intermediate middle class are only taxed up to 16%. France is among the European countries which tax the least, between Malta and the Czech Republic. The tax burden of this family would be much higher in Italy (29%), or in Germany (26%).
France is closer to the European average in terms of the tax burden falling on two-income families and single households. A middle-class single person receives between 27% and 34% of their income in France. But here again, the comparison with certain neighboring countries proves instructive: as long as he belongs to the upper middle class, this same individual would be taxed at 49% in Belgium.
As a result of its redistributive system and progressive taxation, France is particularly generous with its lower middle classes. It is even the only country – with the Czech Republic – where lower middle families with only one income benefit from a negative effective tax rate. In other words, social assistance exceeds the levy level. This is also the case for families with less than two incomes. Low-income singles are, at first glance, the least favored by the State since their tax rate reaches nearly 27%.
That said, the upper middle classes are no more to be pitied in France. At almost equivalent income, the Belgian upper middle class is taxed significantly more, whether for multi-income families (11 points) for single households (15), but also for single-income families (15). Same observation, although less pronounced, for Italy.
The other notable observation of this study is finally the preferential treatment enjoyed by single-income families in France. For the “intermediate” category, a family with only one working adult is taxed roughly the same as a family with two incomes. This is far from being the case in most European countries. In other EU members, single-income households are taxed much more than multi-income households. The gap is, for example, 13 points in Italy. A consequence of the three-color redistributive system.
