Taxation of Couples and Marital Status – Simulation of Three Reforms of the Marital Quotient in France

Guillaume Allègre (), Hélène Périvier and Muriel Pucci

Economie et Statistique / Economics and Statistics, 2021, issue 526-527, 3-20

Abstract: [eng] In France, married couples or couples in civil partnerships must declare their resources jointly and are allocated two tax units. This tax system, referred to as the marital quotient, represents a financial package of around 10 billion euros. Using the Ines microsimulation model, we simulate three reforms of this system: an individualisation of taxation, a reduction of marital quotient to 1.5 tax units while allowing married couples/couples in civil partnerships to opt for individual taxation and, finally, the capping of the marital quotient at the same level as the family quotient. Individualisation results in the highest tax gain, around 7 billion euros, compared with 3.8 billion when the marital quotient is reduced to 1.5 tax units and 3 billion with the marital quotient cap. With these reforms, 46%, 45% and 7% of couples lose out, respectively. The median losses correspond to 1.5%, 1.3% and 2.6% of the disposable income of the households concerned, respectively. Finally, 60%, 64% and 83% of the losses are in the last three standard of living deciles, respectively.

JEL-codes: D31 H24 H31 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Working Paper: Taxation of Couples and Marital Status – Simulation of Three Reforms of the Marital Quotient in France (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:nse:ecosta:ecostat_2021_526d_1

DOI: 10.24187/ecostat.2021.526d.2050

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