Roche & Cie

The French government confirms a decrease in the wage rates

The French government confirms a decrease in the wage rates and an increase in the purchasing power of the assets of January 1, 2018

The Government confirms that it will commit the transfer of employee contributions to the CSG in 2018 in order to restore € 7 billion of purchasing power to the assets. The aim of this measure is to distribute social protection funding more equally, in order to lighten the burden on assets today.

Sickness and unemployment contributions will be abolished in 2018.

The commitment of the President of the Republic will therefore be held in the first year of the quinquennium. 3.15 points of employee contributions will disappear in 2018. Given CSG’s rise of 1.7 points, which finances the measure, the net gain in purchasing power will be 1.45% for all employees, that is € 260 per year for an employee on minimum wage.

This very ambitious redistribution of income in favor of labor income will be achieved in two stages.

  • From January 1, a gain in purchasing power will benefit the employees and the self-employed. 21 million French will see their net income improved. Their gain will be boosted by a second drop in premiums in the fall of 2018.
  • Discussions will take place in autumn 2017 around the Minister of Action and Public Accounts Gérald Darmanin to define the modalities of a compensation for the rise of the CSG for civil servants.

The full 2018 measures and their timetable will be detailed at the time of the presentation of the Social Security Finance and Financing Bills, which will confirm a movement to lower the tax burden.


Source: www.economie.gouv.fr


Cabinet Roche & Cie, English speaking accountant in Lyon, France.
Specialist in Real-Estate and Non-resident taxation.