2026 smoothing mechanism for local authority tax revenue (DILICO): €740m held in reserve
Article 196 of the 2026 Finance Act renews for 2026 the cyclical smoothing mechanism for local authority tax revenue at €740m: €250m levied on inter-municipal bodies with their own taxation whose synthetic resources-and-burdens index exceeds 110% of the average, €140m on départements and €350m on regions, Corsica, French Guiana and Martinique, each contribution capped at 2% of actual operating revenue. Municipalities do not contribute. The amounts are held in reserve and then paid back in thirds over the following three years, 90% to contributors and 10% to equalisation funds. The initial bill provided for €2bn, including €720m from municipalities.
Measure originators
No official estimate found for this measure.
Measure impact
Contribution of €250m from inter-municipal bodies, €140m from départements and €350m from regions, capped at 2% of each authority's actual operating revenue. Individual amounts were notified by the order of 28 May 2026. The proceeds are paid back in thirds in 2027, 2028 and 2029.
Official references
Sources
Procedure timeline
Follow the progress of this fiscal measure through the different stages of the parliamentary procedure.
Entry into force
Immédiate ou à la date prévue
Publication in Official Journal
Administrative implementation
Entrée en vigueur de la mesure et mise en œuvre par l'administration
President of the Republic signature
Publication au Journal officiel
Possible referral to Constitutional Council
Décision de conformité / censure partielle
National Assembly has the final say
Si échec CMP
Debate and vote
Council of Ministers
Validation interne