Closing the Gap: Bringing French Net Salaries Up to Par with the Gross
Proposed Wage Hike by Employer Association
Feast your eyes on that payslip! It's no secret that many folks find themselves longing for the day when their net wage matches the gleaming gross figure. That's the dream Michel Picon, president of the U2P organization, wants to make a reality. On May 6, he unveiled a daring plan to boost net income and enhance purchasing power for the French.
To make this vision a reality, U2P proposes a bold move: eliminating the CSG (general social contribution) and CRDS (social debt repayment contribution) on all revenue streams over the course of five years. The organization estimates this move could inject an extra 116 billion euros into active individuals' wallets, according to BFMTV.
The Chasm Between Gross and Net Income: Widening Over the Years
Take a trip down memory lane, and you'll find that the gap between gross and net income was significantly smaller back in the 1970s. In those days, net income approached 69% of gross income. Fast forward to the 1990s, and that figure shrunk to 60%. Today, an unfortunate 54% of a gross salary becomes your net income. So, if your payslip bears a big, bold "1,000 euros" on the gross line, you'll only see 540 euros post-taxes.
But, if the U2P's plan is to become a reality, they've got a few tricks up their sleeve to make it happen. On the table: raising the flat-rate withholding tax (PFU) or cranking up the CSG on rental income. The organization also floated other ideas such as targeting high pensions by freezing their automatic increase for several years and scrapping the 10% tax break they currently enjoy. And let's not forget about revising the standard VAT rates with a slight uptick and a massive jump in VAT on luxury items, potentially reaching up to 35%.
While the search results don't provide specific information about U2P's proposed measure, one thing's certain—it's a game-changer for French workers. Keep your eyes peeled for more updates on this exciting development!
- Michel Picon, President of U2P, aims to enhance purchasing power for French workers by eliminating the CSG and CRDS on all revenue streams over five years, which could boost net income and inject an estimated 116 billion euros into active individuals' wallets.
- U2P's plan to close the gap between French net and gross salaries also proposes raising the flat-rate withholding tax (PFU) or increasing the CSG on rental income, freezing automatic pension increases for several years, scrapping the 10% tax break for high pensions, and revising standard VAT rates with a slight uptick and a significant increase on luxury items.
- The measure proposed by U2P could significantly impact the finance sector, potentially leading to changes in business operations due to the increased net income of individuals.
- If U2P's plan becomes a reality, it could potentially provide a scholarship-like financial boost to French workers, enabling them to cover various expenses and improve their overall quality of life.
