The Senate votes a reduced rate in public transport and the equine sector

The Senate with a right-wing majority voted Monday, against the advice of the government, to reduce the VAT rate in public transport for the equine sector or even margarine. Proposals to reduce VAT rates are an essential exercise in the review of finance laws.

In the list proposed this year by senators for the 2023 budget, the upper house retained an amendment from the Regional Planning Committee, aimed at applying a reduced VAT rate of 5.5% (instead of 10% ) public, rail, guided or road transport. But for a period of two years only. Left and centrist senators have made proposals along the same lines.

“If we do not act quickly, the supply of public transport will drop sharply and fares will explode for users”, pleaded Philippe Tabarot (LR), stressing that “we will thus be against the current in the face of the climate challenges which wait “.

Rémi Féraud (PS) noted that this rate cut could be “one of the avenues” in response to requests from the president of the Ile-de-France region Valérie Pécresse (LR) to find additional funding for Ile-de-France Mobilities.

“For 10 million Ile-de-France residents, this is a real subject: less supply is a hassle and in addition the prices will increase”, added the centrist Vincent Capo-Canellas. Concerning the equine sector, another chestnut tree, the Senate voted an amendment to subject it to the intermediate rate of 10%.

“A public finance obstacle”, according to Attal

The Minister in charge of Public Accounts Gabriel Attal agreed that “there is no longer any European obstacle to moving forward (…) but there is a public finance obstacle”. “The arbitration is not to provide from this PLF for a reduction in VAT on all or part of the equine sector”. “I think we will get there because we are also pushed by the presidential majority,” he added. The Minister recalled that the International Monetary Fund (IMF) had on Monday “insisted on the extremely constrained nature of our public finances”.

Since the beginning of the examination of the draft budget in first reading in the Senate, the “losses of revenue are piling up”, he warned. “The real estate tax reform is at this stage estimated at around 4 billion euros, inheritance tax is 1.4 billion at the very least, we have 115 million on margarine, 350 million on transport, 320 million on the IS SME and there we would have 180 million more on horses, ”he detailed.

The Senate adopted an amendment to reduce the VAT rate on margarine from 20% to 5.5%. The government will be able to reconsider all these provisions in the continuation of the shuttle or by using article 49.3 of the Constitution in the National Assembly.


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