Économie et Statistique n° 415-416 - Geographic disparities
“Intercommunality” and local direct taxation
The main determinant of all forms of local taxation in France between 1993 and 2006 was the cooperation between municipalities (communes) known as “intercommunality” (intercommunalité). First, a municipality’s membership in a Public Intermunicipal Cooperation Body (Établissement Public de Coopération Intercommunale: EPCI) tends to increase the rates of the four local direct taxes relative to a municipality that does not belong to such a group. Second, the rates are structurally higher in EPCIs that have adopted a single business tax and a supplementary local tax on households (fiscalité mixte). Third, as a rule, local taxation rates tend to rise structurally with municipality size, then decline in the largest cities (over 50,000 inhabitants for property taxes and the occupancy tax [taxe d’habitation], over 100,000 inhabitants for the local business tax). We obtained these results with a structural-residual analysis of taxation levels for the four local direct taxes in municipalities according to their membership in various categories of intermunicipal groupings, their population size, their “degree” of rurality, and the type of “living area” (bassin de vie) to which they belong.