This is what we call a sea serpent. The elimination, or at least the revision, of so-called “brown” tax loopholes regularly comes up in the debate when it comes to saving money. This is still the case this fall when the government intends to find 60 billion euros in 2025 to try to limit the “slippage” of the public accounts deficit.
The day after the presentation of the 2025 budget by Prime Minister Michel Barnier, the question was brought back to the table by Agnès Pannier-Runacher. “The challenge is also to work on brown niches,” declared the Minister of Ecological Transition and Energy on Friday. But what exactly are “brown niches”?
What is a tax loophole?
A tax niche is a tax advantage from which certain categories of professions, sectors or investments benefit. The finance bill for 2023 identified more than 465 tax loopholes in France. Among them, we find investment in real estate in mainland France or in a forestry group (GF). The retirement savings plan, life insurance or donations to associations and NGOs are other ways to reduce taxes. Investments in materials in favor of the ecological transition also reduce the cost.
Companies can also claim this tax advantage, for example with the tax credit for research (CIR), the most costly “niche” amounting to 7.2 billion euros in shortfall for state coffers, according to the Vie publique website.
Journalists, parliamentarians, certain fishermen and firefighters benefit from advantageous tax regimes. In addition to individuals, businesses and professions, certain sectors are also affected by these tax loopholes.
What are “brown” tax loopholes?
The construction, energy, agriculture and even transport sectors can indirectly benefit from tax advantages through reduced rates on certain products with which they work. They are particularly concerned. Because the “brown” tax loopholes are those relating to fossil fuels – oil, gas, or even coal – which promote climate change.
Already, at the start of the year, the reduction of the tax on non-road diesel (GNR) was the subject of lively debate. By planning its abolition, the government of Gabriel Attal had attracted manure and tractors on the roads of France, fueling the anger of farmers. Faced with the revolt, the State reversed course and abandoned the gradual increase in taxation on non-road diesel (GNR).
Our file on the 2025 budget
The new government is therefore exploring other avenues. Among them, a new penalty on the purchase of new polluting cars must affect almost all gasoline and diesel vehicles from January 1, 2025. The savings program also affects companies, which benefited from a reduction in the mass penalty. on all non-plug-in hybrid vehicles.
Agnès Pannier-Runacher also mentioned “the elimination of the reduced VAT rate of 5.5% on the installation of fossil fuel boilers”, as well as an “increase in taxation on plane tickets and on gas. Proposals which are still at the hypothesis stage and which sow a certain government cacophony, pushing the Minister responsible for the Budget and Public Accounts, Laurent Saint-Martin, to refute any “increase in gas taxes”.
