On the optimization methods that evokes Mr

In its views on the limits of business tax ("Les Echos" from November 8), Michel Klopfer takes without shades the stance of those who consider that the companies never pay enough taxes.

The critical author first reform of the professional fee decided by the Government, it considers "hybrid" from the failover on a plate added value advocated by the commission Fouquet in 2004 to explore the trails of this tax reform.

He could observe that business organisations themselves had desired, in the work of the commission, that the tax is based on value added. And that on the contrary they are associations of elected local representatives who rejected such a reform. But it is true that the recall of these positions would have weakened its rationale.

He therefore criticized the Government for the current tax base, which is the capital, while the who capped the added value which companies could he handle localization.

The author thus pretended to ignore that limits existed well before the reform. The Government did that restore consistency to satisfy the principle of a tax based on the contributory capacity of businesses. Ceilings in force prior to 2005 (from 3.5 to 4 of the value added) have been unified and, above all, then the limits applied to a professional tax recalculated on the basis of the prices charged in 1995, Act has updated this reference. Rates had increased so much in ten years that some companies were a professional tax more than 10 of their added value!

The Government and Parliament have also demonstrated real political courage by introducing a mechanism of accountability of actors: now, it may be asked to a company more than 3.5 of its value added to the title of the professional tax (except for the larger, because the CAP is itself capped...). If professional tax, before this CAP, is of a higher amount, the State will bear the gap on the basis of the rate of 2005, the community could not claim the product of rate increases decided after this date.

The reform will decrease, by itself, no Community revenue and will allow all those who vote increases in rates to remove the effects on non-capped companies. While most communities practise high rates and more it is likely that a significant part of the business be capped: it is precisely the safeguard clause that was intended to create the Act.

If subsequent to 2005 rate increases will be no effect on the capped companies, remember that the tax base is the most dynamic of all local taxes. Indeed, what tax national whose base is increasing as the wealth of the country which is case-by-construction of value-added accept that Vienna add more an increase regular rates But it is what happened with the business tax which the weight in GDP has more than doubled since its inception.

On the optimization methods that evokes Mr. Klopfer, that can be attached to the reform of 2005 as value-added limit existed, they have no realistic.

Groups can locate their added value to their liking. The rigour of the accounting standards leaves as little margin of assessment, without even talking about the abuse of law that may rely on the tax administration. Moreover, the developments of the definition of value-added prefer depreciation allowable loads, and legal provisions prevent to deduct certain expenses of the added value.

Suggested by Mr. Klopfer montages would be inoperative moreover. Thus, the business tax paid by companies of a certain size cannot be less than 1.5 of their added value. It would therefore be futile to try to artificially increase the added value of an entity which would have very little capital, because its minimum contribution would increase much. Similarly, the substitution of the acting to labour steady would be irrational on non-tax cost resulting.

It would ultimately be well wrong Board to encourage local communities to seek ways to increase the tax burden on businesses.

To the United Kingdom, the equivalent of the business tax was replaced by a national tax at single rate, because local rates ranged from 1 to 4, which was seen as unsustainable. France, professional tax rate differentials are today from 1 to 12 between Commons more of 10,000 inhabitants... It is therefore necessary to establish a minimum of regulation to control the variances of attractiveness of the territory that generate always the same vicious circle, increase of rates/departures of enterprises and therefore loss of base/loss of resources and new rate increases to compensate, etc.

Mandatory levies on companies cannot increase indefinitely without major damage to the economy. Among these levies, tax is surely one of the most harmful because it strikes the investment, sustainable weakest link in the French economy, report with its eventual profitability. It is a priori tax, these fixed charges on the activity that the France a record level in Europe and marketing projections of profitability of investments. All these titles the real limits of business tax, although still insufficient, is essential: it will serve as the French economy and therefore the sustainable interests of local communities.