Can tax measures be retroactive?

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If the future government were to implement tax increases, could they be applied to the income I received this year?

Since the dissolution of the National Assembly on June 9, many taxpayers have wondered whether the measures decided by the future government at the end of the year it could be applied to your income received during 2024.

In fact, the question arises every year because the income tax scale for a year is only defined at the end of the year, partly due to the indexation of the thresholds to inflation. Thus, for 2024, income, rates and thresholds will be set in the Finance Act for 2025, adopted in principle at the end of 2024. The withholding tax on certain incomes is only a deposit, the adjustment is made in the following year.

If the practice is well established for income subject to the progressive scale, what about those subject to the “flat tax”? [le prélèvement forfaitaire unique] of 30%, which is applied to various property incomes (12.8% income tax and 17.2% social security contributions)?

Gift and inheritance taxes

Dividends and interest are taxed at the time of payment, while capital gains on shares are taxed the year after they are made. If the 2025 finance law modified or eliminated the “flat tax” of 1^Ahem January 2024, this would affect income received this year. This also applies to withdrawals made from life insurance in 2024, for contracts taken out after September 2017.

On the other hand, gift and inheritance taxes paid before a new law are final. What if the law were to modify the real estate tax? A change in the basis of this tax could not be applied before 2025 (depending on the assets at 1^Ahem January 2025). But a possible limit on this tax could be calculated based on income in 2024.