This is a subject that has emerged at the start of the presidential campaign. Inheritance and gift taxes must be reformed, according to candidates from all sides. But their measures diverge strongly depending on their place on the political spectrum. Overview.
France is one of the countries in the world that taxes transmissions the most. According to a recent OECD report (Organization for Economic Cooperation and Development), France is even one of the few states where inheritance and gift taxes represent more than 1% of total tax revenue. (see graph below).
At present, the amount of inheritance tax to which you are subject depends on your link with the deceased, but also on your share of the inheritance. Depending on your situation, you may be entitled to an allowance and a more or less advantageous tax rate.
For example, if the deceased person is your spouse or PACS partner, then you are exempt from inheritance tax. If it is your father or your mother, you benefit from a reduction of 100,000 euros. Beyond this reduction, the scale applied depends on the amount of the remaining part (from 5% up to 8,072 euros to 45% for more than 1,805,677 euros). Non-direct transmissions can be taxed up to 60%.
Donation rights operate by a similar mechanism. It is thus possible to give up to 100,000 euros to your children every 15 years without having to pay taxes. Spouses, brothers, sisters, nephews, nieces, grandchildren and great-grandchildren are also entitled to an allowance, which varies according to their relationship with the donor. For donations too, the scales vary from 5% to 60% depending on the situation.
Raise taxes for the wealthy on the left
But in fact, only a quarter of direct line transmissions are taxed according to Bercy, thanks to “niches” (Dutreil pact, life insurance, etc.) which mainly benefit the richest. Reason why the candidates on the left want to modify the taxation of inheritances.
Jean-Luc Mélenchon (LFI) intends to “increase inheritance tax on the highest estates by accounting for all gifts and inheritances received throughout life” and “cap the sums inherited at 12 million euros”.
Anne Hidalgo (PS) wants to “lower inheritance tax for 95% of French people” by introducing an allowance of up to 300,000 euros (against 100,000 currently). To achieve this, it intends to generate 8 billion euros in revenue per year. How? ‘Or’ What ? By increasing taxes for “very high estates” above 2 million euros.
Yannick Jadot (EELV) proposed this Friday a “reduction of up to 200,000 euros” on inheritance rights, “including on inheritances to grandchildren”. If he is elected, the calculation of the taxes on the transmissions will be done “on the whole of the inheritance inherited throughout his life, and not by distinguishing inheritance rights and gift rights”. He also wants to remove “all exemptions for the very rich”. These new revenues (“8-9 billion euros”) will make it possible to finance dependency and old age.
Fabien Roussel (PCF) plans to eliminate the tax loopholes linked to transmissions and to “make inheritance popular” by proposing a reduction of 118,000 euros on inheritance tax “regardless of the descendants”. Beyond this sum, he promises “a progressive tax and indeed a higher tax on the highest estates”.
Simplify donations on the right
On the right, the bell sound is clearly different. The candidates want instead to reduce taxes on transmissions, and in particular those on gifts.
Valerie Pécresse (LR) offers an allowance on inheritances up to 200,000 euros per child. The allowance would also be increased to 100,000 euros for an indirect transmission, for example in the case where “a person inherits from his uncle or his sister”. Also on the program, tax relief on donations during the donor’s lifetime. In the end, it is a question of “removing inheritance rights for 95% of French people”
Marine Le Pen (RN) wants to reduce the time between two donations to 10 years (against 15 years today), up to 100,000 euros, and exempt real estate up to 300,000 euros.
Eric Zemmour (Reconquest!) wishes to abolish inheritance tax up to “200,000 euros per share” and undertakes not to touch the transfer of companies.
And Emmanuel Macron (LREM) in all of that ? The candidate not yet declared indicated at the beginning of January to the Parisian that he “is not one of those who think that inheritance tax should be increased at all costs”. However, he acknowledged “that there are things to improve” about “popular transmission”. No doubt we will know more when he formalizes his candidacy and reveals his program.