In addition to the department and community shares of the "Old" direct taxes as shown above and to the State share as shown in the table on page 624, slightly less than 1 percent of total assessments of these taxes is paid over to subsidized establishments, such as chambers of commerce, agricultural produce exchanges and similar establishments.

All of these "Old" direct taxes are more or less equally shared between the Departments and the Communities, with the exception of the taxes applied in Alsace-Lorraine, where the balance is strongly in favor of the Communities. The following table shows the division of these taxes as between Departments and Communities in 1937:

With regard to the taxes assimilated to direct taxes and collected to the profit of the Departments and Communities, these taxes are almost exclusively collected for the Communities only, as by their nature the most important ones are for city services (street tax, trash and garbage removal, sewerage tax, dog tax; tax on private clubs, et cetera. Out of total collections of 1,584,056, 140 francs in 1937, 1,532,355,438 francs were for the Communities, and the very small balance was divided between the Departments and special establishments. The rising cost of city services and administration is shown to be keeping pace with the rising cost of national administration by the figures given below:

TOTAL ASSESSMENTS OF ASSIMILATED DIRECT TAXES
(Other Than Those For the State)

There follows an appendix showing the rates of the various income taxes in France, as well as of certain assimilated taxes of the State. It is impossible to give rates on the "Old" direct taxes or on the assimilated direct taxes assessed by departments and communities, as these vary from city to city and department to department. For instance, the "Patente" carries a specific tax per employee or per machine for certain types of business. This tax varies according to the type of business and the population of the place where the business is located. In addition, an ad valorem tax is assessed on the rental value of premises occupied by business, and certain firms pay a tax of 30 centimes per 1,000 francs of capitalization. To the base tax as worked out according to the complicated schedules laid down by State law, the town council meets annually to decide on a coefficient of increase to be applied to the base tax. For precise data on any of these departmental or communal taxes, it is necessary to consult local authorities regarding each specific case.

APPENDIX

LIST OF FRENCH DIRECT TAXES

Income Taxes (All Collected to the Profit of the State)

Assimilated Taxes (Collected to the Profit of the State)

"Old" Direct Taxes (Bstablished Pre-War Except for Alsace-Lorraine)

Taxes Applied Nationally (shared by Departments, Com

munities, State):

On Built Property..

On Unbuilt Property.

Taxes Applied in Old Departments (shared by Departments and Communities):

Residence....

Patente".

Taxes Applied since 1922 in Alsace-Lorraine (shared by
Departments and Communities):

Capital....

Salaries and Wages.

Professions...

Area of Mines.

1937 Assessment (Millions)

2,409.0 1,128.0

1,942.0

3,485.0

16.0

76.0

162.0

0.26

Assimilated faxes (Collected to the Profit of Communities, with Small
Share for Departments and Special Establishments)

Note: For the years 1938 and 1939 (years of income 1937 and 1938) all direct taxes collected to the profit of the State are increased by 8 percent of the amount of the base tax Art. 7 of Decree of May 2, 1938. Rates given in this annex as base rates.

GENERAL INCOME TAX

-

Persons Liable: All residents of France whose incomes exceed the tax-exempt figure.

Deductions Allowed:

The first 10,000 francs of all incomes plus: (1) 5,000 francs for married persons or for widows or widowers with one or more dependent children; and, (2) 5,000 francs for each of the first two children; 10,000 francs for the third child; 15,000 francs for each additional child. The allowances for marital status or children are decreased when the income exceeds 75,000 francs, as follows:

Increases in Tax in Connection with Family Status: The tax due is increased by 30 percent for unmarried, widowed, divorced, or childless married taxpayers, unless with adopted children; by 15 percent for married taxpayers; if married for two years on January 1 of the tax year, if without children, unless with adopted children (these increased not applied to war invalids rated 40 percent or more invalid; to female taxpayers with incomes not over 75,000 francs; not to taxpayers whose children are all deceased). Rate of Tax:

Note: The rate for the highest bracket of income is applied to the total taxable income. The effective rate cannot exceed 36 percent of the net global income before deductions of allowances, other than the deduction of the amount of general income tax paid in the preceding year.

TAX ON INDUSTRIAL AND COMMERCIAL PROFITS

Persons Liable: All persons and companies engaged in industry and commerce except certain cooperative organizations, workmen's dwellings organizations, mutual aid companies, and similar associations.

Deductions Allowed: The following family allowances are permitted persons and members of simple partnerships engaged in industry and

Note: The deduction allowable for dependent children cannot exceea 933 francs per child.

Rate of Tax: 14 percent (7 percent for persons and simple partnerships if the profit is from 5,000 to 10,000 francs; 3.50 percent if the profit does not exceed 5,000 francs).

Artisans engaged in selling the product of their own labor, peddlers, fishermen, chauffeurs and coachmen owning and operating one or two vehicles, and boatmen owning and operating a single boat are allowed to deduct 10,000 francs from their profits (11,000 francs if beneficiaries of disability pensions), and tax is payable on the resultant taxable income at the rate of 3.50 percent for the first 10,000 francs and at the rate of 7 percent for additional profits-with reductions of tax for family allowances as noted below:

Note:

Percent

20

40

100

100

100

Percent

Percent

15

10

30

20

76

60

100

80

100

100

The reduction allowable cannot exceed 933 francs per child.

TAX ON NON-COMMERCIAL PROFITS

Persons Liable: Doctors, lawyers, insurance agents, and in generalpersons practicing a liberal profession.

Deductions Allowed: First 10,000 francs of net profits, plus deductions for dependent children, not to exceed 933 francs per child, at the following rates:

Rate of Tax: 14 percent. (For "charges and offices," 1.e. notaries public, public auctioneers, and other officers subject to ministerial appointment, the tax is on the income without deduction of the first 10,000 francs, and is at the rate of 14 percent for incomes over 10,000 francs; 7 percent for incomes between 5,000 and 10,000 francs; and 3.50 percent for incomes not over 5,000 francs.)

TAX ON AGRICULTURAL PROFITS

Persons Liable: All persons engaged in raising and selling crops of the soil, cattle, horses, et cetera.

Deductions Allowed: First 2,500 francs of net profits (profits as estimated to be equal to the income employed in calculating the land tax, with the exception that profits in excess of 8,000 francs are estimated to be double the income employed in calculating the land tax--the farmer, however, can during the first two months of the year demand that the tax be based on actual profits; likewise, in the same delay, the tax collector can substitute actual profits to estimates when the tax due on the basis of estimates is in excess of 3,000 francs). Allowances for dependent children, not to exceed 933 francs per child, are granted at the following rates:

Rate of Tax: 14 percent, except for the first 7,500 francs of taxable income, on which the rate is 7 percent.

TAX ON SALARIES, PENSIONS, AND ANNUITIES

Persons Liable: All persons residing in France in receipt of income as specified, whether the income is received from a French source or a foreign source.

Deductions Allowed: First 10,000 francs of income (11,000 francs for beneficiaries of disability pensions). The following reductions in the tax as allowed for dependent children, the allowable deduction not to exceed 933 francs per child: