Real estate wealth tax (IFI), which has succeeded the ISF, is expected to generate 2.2 billion euros in revenue in 2024, marking “an increase of 11% of revenue compared to 2023”, according to the details provided Tuesday by the tax administration.
This tax concerns taxpayers with a net real estate assets greater than 1.3 million euros, once applied the 30% reduction on the main residence.
The increase in revenues comes mainly from the increase in the number of households now subject to the IFI. According to the Directorate General for Public Finances (DGFIP), they went from nearly 176,000 in 2023 to around 186,000 in 2024.
The average value of the net heritage declared by household, estimated around 2.5 million euros, remained relatively stable, however displaying an increase of 2% over one year, notes the DGFIP.
Since 2018, the IFI has replaced the solidarity tax on fortune, a device set up in 1981 and suppressed at the beginning of the first five -year term of Emmanuel Macron. Unlike the ISF, which also imposed financial assets, the IFI only concerns real estate assets. Applied rates are progressive, varying from 0.50% to 1.50% depending on the amount of the declared assets.
Donations made within the framework of the IFI declaration, which may under certain conditions open right to a tax reduction, experienced an increase of 6% in 2024, reaching around 200 million euros.
The homes subject to the IFI have significantly higher income than the average: they declared on average 281,000 euros in revenues for the year 2023, against 34,000 euros for all tax households.
If IFI's revenues have been progressing since its creation – they amounted to 1.9 billion euros in 2018 -, they nevertheless remain below those generated by the ISF, which brought around 5 billion euros in 2017.
In a context of strengthened fight against fraud, the Minister of the Economy Eric Lombard said in March wanting to “evolve the contribution of high heritage to combat tax overoptimization”.
“We are working to find a mechanism to combat bypass and the most characterized abuses, especially on heritage, and the idea of a minimum tax rate seems good,” also said the Minister responsible for public accounts, Amélie de Montchalin, in an interview with Dauphiné.
(With AFP)
