Coronavirus : the state will provide around 750 million euro to the communities - The Point

Edward Philippe presented Friday as "a mechanism of compensation of the tax revenue and state-owned" communities to the tune of "around 750 million euro", w

Coronavirus : the state will provide around 750 million euro to the communities - The Point

Edward Philippe presented Friday as "a mechanism of compensation of the tax revenue and state-owned" communities to the tune of "around 750 million euro", which must relate to between 12 000 and 14 000 communes and integrated in a plan of "massive support" amounting to several billion euros. This envelope, which will be contained in the 3rd draft of the amended finance law expected in mid-June, allows the shoulder part of the losses caused by the outbreak of coronavirus and evaluated at the level of 3.2 billion euros up to 2020 for the municipalities and inter-municipal associations. In total, according to estimates by the government, the communities as a whole are expected to see their revenues decrease of approximately 7.5 billion euros in 2020.

The envelope shall be individually calculated, compared to an average revenue over three years (2017, 2018, 2019) in order to smooth the changes, said Edouard Philippe, after a meeting with the representatives of associations of mayors to the prime minister. "It is a safety net secured for the budgets, taking into account the actual losses that are compensated totally ", has confirmed to the Agence France-Presse, the minister of territorial Cohesion Jacqueline Gourault in saluting this "response in the er" part of which will be paid " as soon as this autumn ".

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A system to "smooth out the cost of the measures"

This measure " an unprecedented scale ", according to Édouard Philippe, therefore refers to the tax revenues of municipalities and inter-municipal associations (including the assessment of property of enterprises, the fraction of the contribution on the added value of companies) and state-owned (including parking revenues). But it does not take into account other tariff revenue, as the school canteen, crèches, swimming pools, etc, "We will have further discussions with the local authorities in view of the finance bill 2021," said Jacqueline Gourault.

The head of the government has also announced that it would provide "a billion" additional funds (the endowment of support to local investment) to support "green" investments of commons. "This is also a amount never seen, massive and it should produce a rapid effect in the finance and in the investment of our territorial communities ", said Edouard Philippe.

in addition, Édouard Philippe has confirmed that the expenses related to the coronavirus to be isolated in a specific annex in the budgets of the municipalities. A system, proposed by the secretary of State Olivier Dussopt, will allow " to smooth out over 3 years the cost of measures taken to deal with this Covid-19 ", details Edward Philippe. The Prime minister must also receive Friday (15 hours) the representatives of the departments. Other aid measures are to be expected, then, that the departments anticipate a decline of their revenues and a significant increase in their social spending. Finally, Édouard Philippe will speak in the end of the day, since the ministry of overseas, to announce of the new provisions in favour of these communities.

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Updated Date: 29 May 2020, 07:33

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