Payments to local politicians have long been considered, a tax perspective, as for the expense and thus, consequently, may not be as subject to tax on income of individuals . However, the Act No. 92-108 of 3 February 1992 has changed this situation, and to replace a tax system tax leaving some freedom of choice in local hands. Indeed, Article 204-0 bis of the General Tax Code establishes the principle of withholding allowances applicable to local officials, with legal effect in respect of tax on personal income.
The determination of the taxable amount is then made on the basis of total gross compensation function, which are deducted from social security contributions mandatory - including IRCANTEC - the share of CSG deductible and also a lump sum representing the cost of jobs. This amount is equal to 100% of the amount of compensation paid to the mayors of municipalities with fewer than 500 inhabitants (632.85 euro in 2007 if elected on just one term compensation).
The retention used in this amount is then determined by applying the general rate of income tax (with a single tax share, and without profit for the reduction of 20% set aside for salaries and wages). Most members choose to submit to this withholding, which allows them to exclude their compensation from their other taxable income, and therefore, given the important deduction that can be performed on the amount of compensation (including " package 'fee representative jobs), to benefit from moderate taxation.
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