Tax hike: Electricity tax reinforced, the rich finally spared

“Tax hike: electricity tax comforted, the rich ultimately spared”

MPs voted against a round of tax hikes. This could have repercussions on the French people's wallets.

Dramatic turn of events in the National Assembly! During a first vote on the 2025 budget, the majority of deputies voted against a salvo of tax increases, initially adopted by parliamentarians. This amounts to saying that a number of various tax increases, particularly on the richest and the most prosperous companies, are falling through, at least initially. On the other hand, this means above all that the increase in the electricity tax, which will affect all French people, is well and truly about to come into force.

As a majority of MPs have spoken out against the “revenue” section of the 2025 finance bill, all the adjustments voted on have fallen through. Namely, in particular, a new tax on the wealth of billionaires, an additional tax on dividends of companies with a turnover of 1 billion euros, a universal tax on multinationals, a tax on noisy two-wheelers or even the return of a tax on companies (CVAE). Exit all these additional revenues.

The text will now be sent to the Senate, but it will be the initial version written by the government, the one that plans to double the TICFE, this tax paid by all households and businesses, on their electricity bills. It is this text that also plans for an exceptional contribution from the very rich so that 20% of their income is subject to tax, to increase VAT on boilers at gas or the penalty on polluting vehicles.

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19:06 – What the rejection of the “revenue” section by the Assembly means for the Senate

The “revenue” part of the 2025 finance bill rejected at the Palais Bourbon therefore marks the end of its examination by the deputies, but not only that. Indeed, this will also allow the government to leave with its initial version of the text in the Senate, and not with a text that would have been profoundly reworked if it had been approved. All the tax increases that were originally in the text are therefore back on the table. On the other hand, those added by the left in particular, when the text was passed the Assembly, are removed.

18:06 – Which tax increases have been removed ? 

With this vote, tax increases on the richest have also been eliminated. Among them:

• A new tax on the wealth of billionaires
• The perpetuation of a 20% tax at from a certain level of income
• The perpetuation of an additional tax on very large companies
• A tax on super dividends
• A heavier tax on financial transactions

These measures could still return to the final text depending on the parliamentary work, but it is difficult to imagine the Senate, which is largely in favor of right, to resume these devices initiated mainly by the New Popular Front.

18:01 – What are the tax increases currently planned ?

With this vote by the Assembly, many things are being called into question. As things stand, if nothing were to change, here are all the various tax increases and duties that could come into effect on January 1, 2025:

• Electricity tax increase (TICFE): from 0.21€/KwH to 0.42€ or 0.50€
• Increase in taxes on plane tickets
• Increase in penalties on thermal cars
• Increase in VAT from 5.5 to 20% on boilers gas
• Surtax on very high incomes
• Surtax on large companies
• Tax on share buybacks

This is still subject to the work of the Senate and an agreement between the two parliamentary chambers.

17:52 – Who voted against the tax increase for the wealthiest ?

With this rejection of the text, it is therefore a whole series of tax increases on the wealthiest, particularly companies, which falls through. The RN, the Macronists, as well as LR all voted against. Only the left voted in favour of the revised text, which is now obsolete.

17:41 – What does this vote by the deputies mean for my portfolio ?

At this stage, this vote by the deputies means, mainly, that the increase in the electricity tax, paid by all French people, is retained in the bill, as is the increase in the ecological penalty on vehicles or the increase in VAT on gas boilers. 

While various tax increases had initially been adopted by the deputies and some increases had been cancelled, everything has just fallen through on November 12. 362 deputies voted against the “revenue” part of the finance bill for 2025, thus cancelling all the work carried out by parliamentarians to date.