Purchasing power: how to help households cope with inflation?

Purchasing power: how to help households cope with inflation?

The government has introduced a number of measures and aids to try to deal with inflation. (©Martin Leduc / Actu.fr)

While the government wishes to end the “at all costs” justification for government aid at any cost to tackle the health crisis, it still feels it is necessary to “protect the French” in the face ofgalloping inflation.

In order to cope with the rise in energy and consumer prices, the government has intervened since this summer with a whole range of aids, be it the Purchasing Power Act, the amendment to the Finance Act for 2022 or, more recently, the Finance Bill for 2023.

Here’s what to remember.

Still discount on fuel until Christmas

From April 1, motorists are provided with a discount per liter of fuel (diesel, gasoline, liquefied petroleum gas, natural gas). This measure was extended until December 2022.

Originally 18 euro cents per litre, from 1 September it rose to 30 euro cents including tax per liter until 31 October 2022.

Then, from 1 November to 31 December 2022, the amount of support will increase to 10 euro cents per litre.

Added to this is a TotalEnergies subsidy (for motorists who fill up at their stations) of 20 cents per liter from 1 September to 1 November, then 10 cents per liter until 31 December 2022.

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Expansion of the tariff shield

Until the end of 2022, the tariff shield allows the increase in electricity bills to be capped at 4% and gas prices to be frozen at the level of October 2021. increase, but the government decided to extend the tariff shield, this time limiting the increase to 15%.

For gas, the price shield will apply from January 1, 2023, and from February 1, 2023 for electricity.

Exceptional energy vouchers from 100 to 200 euros

The government also plans to pay an exceptional energy check to around 12 million households at the end of 2022. This support, from 100 to 200 euros, depending on the composition and means of the household, must be paid “before the end of the year”.

Annual amounts that should serve as a reference can be found in this article.

Support for heating households with heating oil from 100 to 200 euros

In addition to exceptional energy vouchers, some households heating with heating oil will be able to accumulate special assistance, ranging from 100 to 200 euros.

This aid for 1.4 million French people (i.e. half of the households that heat with diesel) must be paid “from November”.

Macron Bonus Boosted as a Share Value Bonus (PPV)

The Macron Bonus, established in 2019, becomes the Value Sharing Bonus, the amount of which has been revised. This annual bonus, which remains optional and at the discretion of the employer, can reach:

  • 6,000 euros tax-free in companies that have signed a profit-sharing or profit-sharing agreement.
  • otherwise 3000 euros

Payment can be made from July 1, 2022 to December 31, 2023.

Here you can find all the details to see if you qualify for this value sharing bonus.

In addition to this measure, there are other measures related to work, such as the option to buy back unclaimed RTT (free from taxes and contributions until 31 December 2025), exceptional release of employee savings up to 10,000 euros (until 31 December 2022) , doubling the transport bonus for employees or increasing the tax exemption ceiling for overtime hours from €5,000 to €7,500 until 31 December 2025.

Changes in the income tax schedule

This is a measure that should allow taxpayers to mechanically avoid paying higher taxes due to inflation. In its Finance Bill 2023, the government decidedindex the income tax scale to the level of inflation excluding tobacco, i.e. 5.4%.

Without this, some taxpayers could become non-taxpayers, while others could move into a higher bracket and therefore pay higher taxes.

Abolition of audiovisual license fee

Another tax-related measure for the benefit of purchasing power: the abolition of the audiovisual license fee effective from this year, saving 138 euros (mainland) or 88 euros (overseas) to 27 million households.

Without forgetting that this year the payment of housing tax ends for the last households that still had to pay it. Therefore, from 2023, no one will pay housing tax from the main residence (but still from the secondary residence or vacant accommodation), nor audiovisual fees.

Also various upgrades

Added to these measures are various revaluations carried out by the government in an attempt to limit the impact of inflation on the wallet. Re-evaluation of pensions, re-evaluation of social benefits (RSA, activity allowances, family allowances…), housing support, student grants, deconjugalisation of disabled adult allowance… Or even an exceptional return to school.

Added to this are facilities to better manage your budget, such as the ability to terminate any consumer contract online, the ability to buy any type of food with a meal voucher (now reduced to 25 euros) or further limiting the increase of the fixed rent to a maximum of 3.5%.

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