Donations for the reconstruction of Notre-Dame: tax deductions at the heart of polemics

ON DECRYPT

It is a symbolic and impressive figure that was about to be reached on Wednesday, less than 48 hours after the disaster that severely damaged Notre-Dame de Paris. Between the donations of large groups, those of public institutions and those of individuals, it is more than a billion euros that will surely collected to rebuild the cathedral bruised by the flames. At a minimum, this figure could rise significantly in the days, weeks and months to come.

But the paradox is that the more this figure increases, the more the burden for the state, and ultimately for taxpayers, increases too. Because the tax regime on donations is very favorable in France. "It is the public community that will take the essentials [reconstruction costs] in charge!" Warned Gillez Carrez, MP LR, special rapporteur of the heritage program for the Finance Committee of the National Assembly, from Tuesday evening in The World . The elected representative of Val-de-Marne is not wrong. And some are annoyed by the fact that major French groups potentially benefit from this tax rebate. When others claim its extension.

Why are there controversies?

The eagerness to pull out the checkbook of large French groups, sometimes willing to tax optimization, has creaked some teeth, left especially. "We can not make the preservation of our heritage a great communication operation as some are doing," said the head of the list France insubordinate for Europeans Manon Aubry Wednesday morning on LCI, denouncing "a species the simplest, it would already be that they start paying their taxes, they can not afford a communication operation. by putting their name potentially on a stone of Notre Dame and on the other side, do not pay their taxes, "she criticized.

To cut short this controversy, the family Pinault, who promised 100 million euros, announced Wednesday morning that she would give up the tax credit, as Europe 1 revealed in the morning. "The donation for Notre-Dame de Paris will not be subject to any tax deduction.The Pinault family considers that it is not question of charging the French taxpayers," said in a statement , François-Henri Pinault, president of the family holding company and CEO of the luxury group Kering.

But it is also the ease with which the big French groups were able to unlock huge amounts of money that made tick. "If they are able to give tens of millions to rebuild Our Lady, let them stop telling us that there is no money to satisfy the social emergency," denounced the secretary general of the CGT, Philippe Martinez Wednesday on France Info. "Shabby" controversy, retorted the boss of Medef Geoffroy Roux de Bezieux. The national unity that seized politics and the social actors after the fire of the cathedral seems indeed to have lived.

What does the law provide for individuals and businesses?

The tax regime for donations to associations or foundations is governed by the Act of August 1, 2003, known as the Aillagon Act, named after the Minister of Culture at the time (and which will be discussed a little later). This text defines the reimbursements that individuals and companies can benefit from, provided that they are given to organizations of general interest recognized by the State. This excludes from the scope of the tax credit any participation in an online prize pool.

#For individuals
The law provides for a personal income tax reduction of 66% of the donation amount, up to a limit of 20% of taxable income. In concrete terms, if a taxpayer gives 10,000 euros for reconstruction, he will receive a tax credit of 6,600 euros, provided that his taxable income exceeds 33,000 euros. If this taxable income is for example 30,000 euros, then this taxpayer will only be able to touch 6,000 euros.

Another measure: if the tax credit exceeds the amount owed by the taxpayer, the taxpayer may decide to keep all or part of the amount to reduce his tax for the next five years, until his credit is exhausted.

For the wealthiest taxpayers, eligible for the real estate tax (IFI) - which replaces the ISF - the reduction goes up to 75% of the donation amount, up to a limit of 50,000 euros, a limit reached when the donation amounts to 66,666 euros. So if a person to pay the IFI gives 30,000 euros for the reconstruction of Notre-Dame, she can recover 22,500 euros to lighten the weight of its IFI.

#For companies
For businesses, it is the corporation tax that can be reduced by a tax credit following a donation. This time, the amount of the tax credit is 60% of the donation, against 66% for individuals. Again, the law provides for a ceiling, corresponding to 0.5% of the turnover of the company declared in France. In concrete terms, the Arnault family, which has promised to give 200 million euros through its investment fund, can expect 120 million euros from the tax authorities, if its reported turnover exceeds 24 billion euros.

Like individuals, businesses can decide, if the amount of the tax credit exceeds the amount of corporation tax to be paid, to use the surplus in the next five years.

The device is ultimately far from painless for the state coffers. According to the report of the Court of Auditors of 2018, the device Aillagon cost, concerning the only companies, 930 million in 2016, against 90 million in 2004. With the fire of Notre-Dame, the figure could explode in Budget 2020 "This is the problem of this kind of device: it can be a budget problem," explained Gilles Carrez in Le Monde .

Will the law change?

Some want to change the device to allow the world to participate in the reconstruction effort. Senators Republicans have announced that they have tabled a bill to increase the tax credit for individuals to 90% of the donation amount, up to a limit of 1,000 euros. The government should not go that far. Prime Minister Edouard Philippe has indeed announced Wednesday, leaving a Council of Ministers devoted to this topic alone, the presentation "as soon as next week" of a bill to give a "legal framework" to donations paid for the reconstruction of Notre-Dame de Paris. This bill will provide, among other things, a tax exemption of 75% for donations by individuals up to 1,000 euros.

As for the former Minister of Culture Jean-Jacques Aillagon, currently Director General of the Pinault collection, he asked, before retracting, that the National Treasury regime be extended to Notre-Dame, so that the reduction of tax climbs to 90% of the donation.

That the State quickly decree Notre Dame "National Treasure" so that the donations made for its reconstruction benefit from the tax reduction of 90% provided for by the law on sponsorship known as law Aillagon | Elysee @ @ @ gouvernementFR MinistereCC

But regarding business, the law should not change. "Companies will benefit from tax cuts, called patronage, under current conditions," said the Prime Minister.