Structural reformIn effectProperty taxNational

Transfer of the departmental share of the built property tax to municipalities, with a correction coefficient

In return for abolishing the housing tax on main residences, Article 16 of the 2020 Finance Act transfers the departmental share of the built property tax to municipalities from 2021. The 2021 municipal reference rate equals the sum of the municipal and departmental rates applied in 2020 in the municipality (Article 1640 G of the General Tax Code, excluding the City of Paris). A correction coefficient calculated for each municipality offsets the gap between the housing tax lost and the departmental property tax received. Departments, inter-municipal bodies and the City of Paris receive a share of net VAT revenue from 2021 as compensation.

Measure originators

InitiatorGVT

Gérald Darmanin

Gouvernement

Impact on public finances

No official estimate found for this measure.

Effective date

1 January 2021

Measure impact

At unchanged rates, the measure does not change the amount owed by owners: only the presentation of rates changes on the 2021 property tax notice, where the departmental column disappears and the municipal rate rises accordingly. It redistributes revenue between municipalities, departments and inter-municipal bodies.