Trisha Shetty (Editor)

Solidarity tax on wealth

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The solidarity tax on wealth (French: Impôt de solidarité sur la fortune or ISF) is an annual direct wealth tax on those in France having assets in excess of €1,300,000, (since 2011) . It was one of the Socialist Party's 1981 electoral program's measures, 110 Propositions for France. First named IGF (Impôt sur les Grandes Fortunes), it was abolished in 1986 by Jacques Chirac's right-wing government, but re-established in 1988 as ISF in slightly different terms after François Mitterrand's re-election.



The calculation applies to tax declarers, meaning that it can apply to a grouping of two individuals: married couples, cohabiting couples, or couples with a PACS. All global assets are taken into account for French residents; for others, the tax is based on assets that reside in France, with the exception of financial ones.

ISF is controversial; critics claim it drives away wealthy individuals from the country, resulting in financial loss. A report by a senator estimated that 843 people left France in 2006 because of the tax, resulting in a net loss of €2.8 billion.


In principle all assets are taken into account except for the following:

  • professional goods such as enterprises (depending on the percentage owned),
  • vintage (more than one century old) and collection objects,
  • artistic, literature, or industrial rights,
  • woods and participation in forestry plantations (for 75% of their value),
  • anonymous bonds,
  • capital value of pensions and retirement plans,
  • capital obtained as compensation for physical injury in accidents or due to illness.
  • Revenue

    ISF brought in €4.42 billion in 2007, 19% more than in 2006. It constitutes 1.5% of France's total tax receipts.

    Half of all households who pay ISF make an annual contribution of less than €2,000.

    Rules to fix the net taxable value

    ISF is levied on what remains of the gross value after subtracting deductible debts. The gross value is determined by the declarer following certain rules. For example, the value of the principal home is reduced by 30%, as is done for some rental income. Certain real estate properties in countries with a fiscal convention such as Denmark, Luxembourg, Egypt, Finland, Netherlands, and Czech Republic are excluded. The furniture in the home cannot exceed 5% of the total value of the other goods.

    Following President Nicolas Sarkozy's tax law of 2007, ISF was adjusted so that the sum of all taxes due in France would not exceed 50% of the annual revenues. He overturned this in 2011, at the same time as lowering the rates of the ISF.


    After calculation, a deduction is granted for minors or any disabled persons living in the same household.


    The tax must be declared by residents of France by June 15; by other EU residents who own French property valued in excess of the threshold by July 15, and by other people by August 31.


    Solidarity tax on wealth Wikipedia