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Decision no. 2012-662 DC of 29 DECEMBER 2012

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Law on finances for 2013

In the conditions provided for by Article 61-2 of the Constitution, the Constitutional Council was seized of an application relating to the Law on Finances for 2013 on 20 December 2012 by Mr Jean-Claude GAUDIN, Mr Pierre ANDRÉ, Mr Gérard BAILLY, Mr Philippe BAS, Mr René BEAUMONT, Mr Christophe BÉCHU, Mr Michel BÉCOT, Mr Claude BELOT, Mr Jean BIZET, Mr Pierre BORDIER, Ms Natacha BOUCHART, Mr Joël BOURDIN, Ms Marie-Thérèse BRUGUIÈRE, Mr François-Noël BUFFET, Mr François CALVET, Mr Christian CAMBON, Mr Jean-Pierre CANTEGRIT, Mr Jean-Noël CARDOUX, Mr Jean-Claude CARLE, Ms Caroline CAYEUX, Mr Gérard CÉSAR, Mr Pierre CHARON, Mr Alain CHATILLON, Mr Jean-Pierre CHAUVEAU, Mr Marcel-Pierre CLEACH, Mr Christian COINTAT, Mr Gérard CORNU, Mr Raymond COUDERC, Mr Jean-Patrick COURTOIS, Mr Philippe DALLIER, Mr Serge DASSAULT, Ms Isabelle DEBRÉ, Mr Francis DELATTRE, Mr Robert del PICCHIA, Mr Gérard DÉRIOT, Ms Catherine DEROCHE, Ms Marie-Hélène DES ESGAULX, Mr Éric DOLIGÉ, Mr Philippe DOMINATI, Mr Michel DOUBLET, Ms Marie-Annick DUCHÊNE, Mr Alain DUFAUT, Mr André DULAIT, Mr Ambroise DUPONT, Mr Louis DUVERNOIS, Mr Jean-Paul EMORINE, Mr Hubert FALCO, Mr André FERRAND, Mr Louis-Constant FLEMING, Mr Michel FONTAINE, Mr Bernard FOURNIER, Mr Jean-Paul FOURNIER, Mr Christophe-André FRASSA, Mr Pierre FROGIER, Mr Yann GAILLARD, Mr René GARREC, Ms Joëlle GARRIAUD-MAYLAM, Mr Jacques GAUTIER, Mr Patrice GÉLARD, Mr Bruno GILLES, Ms Colette GIUDICELLI, Mr Alain GOURNAC, Mr Francis GRIGNON, Mr François GROSDIDIER, Mr Charles GUENÉ, Mr Pierre HÉRISSON, Mr Michel HOUEL, Mr Alain HOUPERT, Mr Jean-François HUMBERT, Mr Jean-Jacques HYEST, Ms Sophie JOISSAINS, Ms Christiane KAMMERMANN, Mr Roger KAROUTCHI, Ms Fabienne KELLER, Ms Élisabeth LAMURE, Mr Gérard LARCHER, Mr Daniel LAURENT, Mr Jean-René LECERF, Mr Antoine LEFÈVRE, Mr Jacques LEGENDRE, Mr Dominique de LEGGE, Mr Jean-Pierre LELEUX, Mr Jean-Claude LENOIR, Mr Philippe LEROY, Mr Gérard LONGUET, Mr Roland du LUART, Mr Philippe MARINI, Mr Pierre MARTIN, Mr Jean-François MAYET, Ms Colette MÉLOT, Mr Alain MILON, Mr Albéric de MONTGOLFIER, Mr Philippe NACHBAR, Mr Louis NÈGRE, Mr Philippe PAUL, Mr Jackie PIERRE, Mr Xavier PINTAT, Mr Louis PINTON, Mr Rémy POINTEREAU, Mr Christian PONCELET, Mr Ladislas PONIATOWSKI, Mr Hugues PORTELLI, Ms Sophie PRIMAS, Ms Catherine PROCACCIA, Mr Jean-Pierre RAFFARIN, Mr Henri de RAINCOURT, Mr André REICHARDT, Mr Bruno RETAILLEAU, Mr Charles REVET, Mr Bernard SAUGEY, Mr René-Paul SAVARY, Mr Michel SAVIN, Mr Bruno SIDO, Ms Esther SITTLER, Ms Catherine TROENDLE, Mr François TRUCY, Mr Hilarion VENDEGOU, Mr René VESTRI and Mr Jean-Pierre VIAL, Senators;

And on the same day by Mr Christian JACOB, Mr Bernard ACCOYER, Mr Yves ALBARELLO, Mr Benoist APPARU, Mr Olivier AUDIBERT TROIN, Mr Jean-Pierre BARBIER, Mr Xavier BERTRAND, Mr Jean-Claude BOUCHET, Mr Xavier BRETON, Mr Gilles CARREZ, Mr Yves CENSI, Mr Alain CHRÉTIEN, Mr François CORNUT-GENTILLE, Mr Edouard COURTIAL, Ms Marie-Christine DALLOZ, Mr Gérald DARMANIN, Mr Bernard DEFLESSELLES, Ms Sophie DION, Mr Jean-Pierre DOOR, Ms Virginie DUBY-MULLER, Mr Daniel FASQUELLE, Ms Marie-Louise FORT, Mr Yves FOULON, Mr Marc FRANCINA, Mr Laurent FURST, Mr Claude de GANAY, Mr Sauveur GANDOLFI-SCHEIT, Mr Bernard GÉRARD, Mr Franck GILARD, Mr Claude GOASGUEN, Mr Philippe GOSSELIN, Ms Anne GROMMERCH, Mr Christophe GUILLOTEAU, Mr Michel HERBILLON, Mr Antoine HERTH, Mr Guénhaël HUET, Mr Sébastien HUYGHE, Mr Christian KERT, Ms Valérie LACROUTE, Mr Marc LAFFINEUR, Ms Laure de LA RAUDIÈRE, Mr Marc LE FUR, Mr Bruno LE MAIRE, Mr Pierre LEQUILLER, Mr Philippe LE RAY, Mr Lionnel LUCA, Mr Jean-François MANCEL, Mr Laurent MARCANGELI, Mr Thierry MARIANI, Mr Hervé MARITON, Mr Olivier MARLEIX, Mr Alain MARTY, Mr François de MAZIÈRES, Mr Damien MESLOT, Mr Pierre MORANGE, Mr Pierre MOREL-A-L'HUISSIER, Mr Jean-Luc MOUDENC, Mr Alain MOYNE-BRESSAND, Mr Jacques MYARD, Mr Dominique NACHURY, Mr Yves NICOLIN, Mr Axel PONIATOWSKI, Ms Josette PONS, Mr Bernard REYNES, Mr Franck RIESTER, Mr Martial SADDIER, Mr François SCELLIER, Ms Claudine SCHMID, Mr André SCHNEIDER, Mr Fernand SIRÉ, Mr Éric STRAUMANN, Ms Michèle TABAROT, Mr Jean-Charles TAUGOURDEAU, Mr Jean-Marie TÉTART, Mr Dominique TIAN, Ms Catherine VAUTRIN, Mr Patrice VERCHÈRE, Mr Philippe VITEL, Mr Michel VOISIN, Mr Jean-Luc WARSMANN, Ms Marie-Jo ZIMMERMANN, Mr Élie ABOUD, Mr Sylvain BERRIOS, Mr Charles de COURSON, Mr Yves JÉGO, Mr Jean-Christophe LAGARDE and Mr Philippe VIGIER, Members of Parliament;

And on the same day by Mr François FILLON, Mr François BAROIN, Mr Jacques Alain BÉNISTI, Mr Marcel BONNOT, Ms Valérie BOYER, Mr Bernard BROCHAND, Mr Dominique BUSSEREAU, Mr Jérôme CHARTIER, Mr Guillaume CHEVROLLIER, Mr Jean-Louis CHRIST, Mr Dino CINIERI, Mr Éric CIOTTI, Mr Jean-Michel COUVE, Mr Charles de LA VERPILLIÈRE, Mr Camille de ROCCA SERRA, Mr Bernard DEBRÉ, Mr Jean-Pierre DECOOL, Mr Rémi DELATTE, Mr Dominique DORD, Ms Marianne DUBOIS, Mr Christian ESTROSI, Mr Hervé GAYMARD, Ms Annie GENEVARD, Mr Guy GEOFFROY, Mr Charles-Ange GINESY, Mr Jean-Pierre GIRAN, Mr Philippe GOUJON, Ms Claude GREFF, Ms Anne GROMMERCH, Ms Arlette GROSSKOST, Mr Serge GROUARD, Ms Françoise GUÉGOT, Mr Jean-Claude GUIBAL, Mr Jean-Jacques GUILLET, Mr Michel HEINRICH, Mr Patrick HETZEL, Mr Philippe HOUILLON, Mr Jean-François LAMOUR, Mr Thierry LAZARO, Ms Isabelle LE CALLENNEC, Mr Dominique LE MÈNER, Mr Alain LEBOEUF, Mr Jean LEONETTI, Mr Céleste LETT, Ms Geneviève LEVY, Ms Véronique LOUWAGIE, Mr Gilles LURTON, Mr Alain MARC, Mr Alain MARLEIX, Mr Philippe Armand MARTIN, Mr Jean-Claude MATHIS, Mr Patrick OLLIER, Ms Valérie PECRESSE, Ms Bérengère POLETTI, Mr Frédéric REISS, Mr Arnaud ROBINET, Mr Claude STURNI, Mr Lionel TARDY, Mr Guy TEISSIER, Mr Michel TERROT, Mr François VANNSON, Mr Jean-Sébastien VIALATTE, Mr Jean-Pierre VIGIER, Mr Laurent WAUQUIEZ and Mr Éric WOERTH, Members of Parliament.

THE CONSTITUTIONAL COUNCIL;

Having regard to the Constitution;

Having regard to Ordinance no. 58-1067 of 7 November 1958 as amended, concerning the basic law on the Constitutional Council;

Having regard to Basic Law no. 2001-692 of 1 August 2001, as amended, regarding laws on finance;

Having regard to the General Tax Code;

Having regard to the General Local Authorities Code;

Having regard to the General Code Regulating the Property of Public Bodies;

Having regard to the Code of Social Action and Families;

Having regard to the Environmental Code;

Having regard to the Financial Courts Code;

Having regard to the Monetary and Financial Code;

Having regard to the Social Security Code;

Having regard to Law no. 88-227 of 11 March 1988 on financial transparency in politics;

Having regard to Ordinance no. 96-50 of 24 January 1996 on the repayment of health service debt;

Having regard to Law no. 2010-1657 of 29 December 2010 on finances, amended for 2011;

Having regard to Law no. 2011-1978 of 28 December 2011 on finances, amended for 2011;

Having regard to the observations of the Government, registered on 24 December 2012;

Having heard the Rapporteur;

1. Considering that the applicant Senators and Members of Parliament have referred to the Constitutional Council the Law on finances for 2013; that they dispute the constitutionality of Articles 9, 12, 13 and 73 thereof; that the Senators moreover dispute the procedure followed in adopting the Law as a whole, its sincerity and the constitutionality of Articles 22 to 24 thereof; that the Members of Parliament also dispute the inclusion in the Law on finances of Article 8 of paragraph I of Article 51 and Article 104 along with the constitutionality of Articles 3, 4, 6, 8, 10, 11, 15, 16 and 25;

THE PROCEDURE FOR ADOPTING THE LAW AS A WHOLE:

2. Considering that, according to the applicant Senators, the presentation and adoption of a preliminary question during the examination and re-reading of the draft finance bill for 2013 in the Senate amounted to a procedural impropriety; that they argue that given the absence of any obstructionist intention on the part of the opposition during the examination of the bill, the adoption of this preliminary question hindered the proper conduct of democratic debate, the proper functioning of public constitutional powers and the right of amendment guaranteed under Article 44 of the Constitution; that the law referred was consequently adopted in accordance with a procedure which was unconstitutional;

3. Considering that the draft finance bill for 2013 was tabled in the National Assembly on 28 September 2012 and adopted on first reading by the National Assembly on 20 November 2012; that the Senate rejected the first part of the draft finance bill for 2013 on 28 November 2012, thus hindering discussion of the second part of the bill; that following this rejection on 6 December 2012 by the joint committee charged with proposing a draft text of the provisions still under discussion, the National Assembly initiated a second reading of the draft bill and adopted it on 14 December 2012; that, whilst the Senate was seized of the draft bill adopted by the National Assembly on second reading, the president of the principal majority grouping in the Senate tabled a motion objecting to the preliminary question to be addressed prior to discussion of the draft bill under conditions which clearly established that the approval of that motion was sought not in order to establish substantive opposition to the text but rather in order to speed up the procedure by which Parliament was to adopt the text, after considering the consequences both of the rejection of the draft bill during its first reading in the Senate as well as the lack of a majority in favour of the adoption of the draft bill on 18 December 2012 following examination by the Finance Committee; that after this preliminary question was adopted on 18 December 2012, the Government requested the National Assembly to reach a definitive decision, in accordance with the provisions of the fourth subparagraph of Article 45 of the Constitution, which it did so on 20 December 2012;

4. Considering that the proper conduct of democratic debate, and accordingly the proper functioning of public constitutional powers, presuppose that the right of amendment granted to Members of Parliament pursuant to Article 44 of the Constitution is fully respected and that the Members of Parliament and the Government may use the procedures made available to them to this effect without restriction;

5. Considering that this twofold requirement implies that these rights may not be exercised in a manifestly excessive manner;

6. Considering that under the circumstances within which it occurred, the adoption of a preliminary question during the examination of a draft bill on second reading before the Senate does not impinge upon the constitutionality of the law referred; that the procedure followed during the examination of the draft bill was not therefore unconstitutional;

THE SINCERITY OF THE LAW ON FINANCES:

7. Considering that the applicant Senators assert that the Law on finances is insincere on the one hand in that it is based on very optimistic economic forecasts, and on the other hand since the Government would be required to implement it "having regard to the evolution of the economic commitments of its own economic policy"; that in particular, the Law on finances should have drawn the consequences of the introduction into the draft adjustment bill on finances for 2012 of the "National Pact for Growth, Competitiveness and Employment";

8. Considering that pursuant to Article 32 of the aforementioned basic Law of 1 August 2001: "Laws on finances shall present in a sincere manner all financial revenue and costs of the State. Their sincerity shall be assessed taking account of available information and the forecasts which may reasonably be made from this"; that it follows that the sincerity of the law on finances for any given year is characterised by the absence of any intention to misrepresent the general framework of the equilibrium it provides for;

9. Considering that it does not follow from the information placed before the Constitutional Council that the economic forecasts on which the Law on finances is based have been invalidated by virtue of an intention to distort the overall equilibrium of the law referred;

10. Considering that Parliament considered that the tax credit inserted into Article 24-bis, which subsequently became Article 66, of the third draft bill on finances for 2012, did not affect the budgetary equilibrium for 2013; that in any case, if the development of taxation or revenue be such as to alter the overall framework of the budgetary equilibrium, it would be for the Government to submit an amended draft bill on finances to Parliament;

11. Considering that it results from the above that the objecting alleging a lack of sincerity in the Law on finances must be rejected;

ARTICLE 3:

12. Considering that Article 3 amends subparagraph 1 of paragraph I of Article 197 of the General Tax Code with a view to establishing a new marginal rate of taxation of 45% for the portion of income subject to income tax exceeding 150,000 Euros per share;

13. Considering that, according to the applicant Members of Parliament, the creation of a supplementary progressive tax band for income tax creates inequality in relation to public charges; that they also argue that, when applied to the particular category of income comprised of pensions paid in relation to defined-benefit retirement plans subject to the contributions provided for under Articles L. 137-11 and L. 137-11-1 of the Social Security Code, this new marginal rate of income tax would have the effect of subjecting this income to a confiscatory tax, in breach of the duty to respect the capacity of taxpayers to pay tax, the principle of equality and the right of ownership; that consequently, the Constitutional Council should review the constitutionality of Article L. 137-11-1 of the Social Security Code and rule it unconstitutional;

14. Considering on the one hand that pursuant to Article 6 of the 1789 Declaration of the Rights of Man and the Citizen, the law “must be the same for all, whether it protects or punishes”; that the principle of equality does not prevent the legislator from settling different situations in different ways, or from derogating from equality for reasons of general interest, provided that in both cases the difference in treatment that results is directly related to the subject matter of the law established thereby; that it does not follow that the principle of equality requires different treatment for people in different situations;

15. Considering that Article 13 of the 1789 Declaration provides: “A common contribution is essential for the maintenance of the public forces and for the cost of administration. This should be equitably distributed among all the citizens in proportion to their means”; that this requirement will not be respected if the tax is confiscatory in nature or imposes an excessive burden on a category of taxpayers, taking account of their capacity to pay tax; that pursuant to Article 34 of the Constitution, it is for Parliament to determine, in accordance with constitutional principles and taking account of the characteristics of each tax, the rules according to which the capacity to pay tax must be assessed; that in particular, in order to ensure that the principle of equality is respected, it must base its assessment on objective and rational criteria intended to further the goals it proposes; that this assessment may not however result in any inequality in relation to public charges;

16. Considering in the first place that the establishment by Article 3 of a new marginal rate of taxation of 45% for the portion of income subject to income tax exceeding 150,000 Euros per share increases tax revenue and enhances the progressive nature of the system of income tax; that in itself, it does not impose an excessive burden on taxpayers having regard to their capacity to pay tax and does not result in any inequality in relation to public charges;

17. Considering secondly that the revenue comprising pensions paid in relation to defined-benefit retirement plans, which are subject to income tax at the rate provided for under subparagraph 1 of paragraph I of Article 197 of the General Tax Code, as amended by Article 3 of the law referred, as also subject to the exceptional contribution on high incomes provided for under Article 223-sexies of the General Tax Code, to the general social contribution provided for under Article L. 136-1 of the Social Security Code, to the contribution for the repayment of the health service debt provided for under Article 14 of the aforementioned Ordinance no. 96-50 of 24 January 1996 along with the contribution provided for under Article L. 137-11-1 of the Social Security Code; that pensions paid starting from 2013 will also be subject to the contribution provided for under Article L. 14-10-4 of the Code of Social Action and Families;

18. Considering that, on the one hand, whilst when assessing compliance with the principle of equality in relation to public charges on the one hand it is necessary to take account of the overall body of taxes applicable to the same income which are paid by the same taxpayer, nevertheless the contribution provided for under Article L. 137-11 of the Social Security Code is a levy on the employer which does not apply to the amount of pension paid; that accordingly, it need not be taken into account in this assessment;

19. Considering on the other hand that, as a result of the amendment provided for under Article 3 and after taking into account the deductibility of a portion of the general social contribution and of a portion of the contribution provided for under Article L. 137-11-1 of the General Social Security Code from the amount liable to income tax, the maximum marginal rate of taxation applicable to pensions paid in relation to defined-benefit retirement plans has been increased to 75.04 % for pensions received in 2012 and to 75.34 % for pensions received starting from 2013; that this new level of taxation imposes an excessive burden on taxpayers having regard to their capacity to pay tax; that it breaches the principle of equality in relation to public charges;

20. Considering that the constitutionality of a law which has already been promulgated may be assessed during the examination of legislative provisions which amend or supplement that law or alter its scope; that in the present case, the increase in the maximum marginal rate of taxation to the income tax band provided for under the contested Article has the effect, in conjunction in particular with the application of the maximum marginal rate of the contribution provided for under Article L. 137-11-1 of the Social Security Code as in force following the enactment of the aforementioned Law no. 2011-1978 of 28 December 2011, of amending the scope of the marginal rate of this tax, having regard to the capacity to pay tax of taxpayers; that accordingly, Article 3 of the law referred must be deemed to affect the scope of the provisions of Article L. 137-11-1 of the Social Security Code;

21. Considering that, under these conditions, in order to remedy the issue of the unconstitutionality of the excessive burden having regard to the capacity to pay tax of certain taxpayers in receipt of pensions paid in relation to defined-benefit retirement plans, the provisions of the fifth and ninth subparagraphs of Article L. 137-11-1 of the Social Security Code and the phrase: "and lower than or equal to 24,000 Euros per month" contained in the fourth and eight subparagraphs of the same Article must be ruled unconstitutional;

22. Considering that, under these conditions, Article 3 of the law referred is constitutional;

ARTICLE 4:

23. Considering that Article 4 amends subparagraph 2 of paragraph I of Article 197 of the General Tax Code; that it lowers from 2,336 to 2,000 Euros the limit per half-share of the reduction in tax resulting from the application of the family allowance; that it increases from 661 Euros to 997 Euros the tax reduction for certain taxpayers benefiting from a half-share due to social circumstances or special family circumstances; that it adds to subparagraph 2 an additional indent which provides that widowed taxpayers with dependent children who benefit from a supplementary share of the family allowance shall be entitled, under certain circumstances, to a reduction in tax equal to 672 Euros for this supplementary share;

24. Considering that, according to the applicant Members of Parliament, the reduction of the threshold for the benefit provided by the family allowance runs contrary to the principle of equality in relation to public charges; that Article 4 would result in inequality in relation to public charges with regard to childless taxpayers and those with children, and even in a breach of the principle of equality with regard to taxpayers with children, depending upon the number of children included within the household; that the applicants argue that this measure is not proportionate with Parliament's objective of enhancing the progressive nature of income tax;

25. Considering that, in enacting the contested provisions, Parliament intended to increase tax revenues and to reduce the benefits granted under the family allowance under ordinary legislation in order to enhance the progressive nature of the tax, whilst limiting the effects of this measure for certain taxpayers with special circumstances;

26. Considering that, according to the very object of the family allowance mechanism and its upper limit, taxpayers with dependent children are treated differently, on the one hand from taxpayers without dependent children and on the other hand depending upon the number of dependent children; that the family allowance threshold does not call into question the consideration of capacity to pay tax resulting from this difference in circumstances; that in any case, Article 13 of the 1789 Declaration does not require that the consideration of charges borne by families when assessing capacity to pay tax must occur according to the family allowance mechanism; that in lowering from 2,336 to 2,000 Euros the upper limit per half-share of the reduction in tax resulting from the application of the family allowance, Parliament did not violate the requirements resulting from Article 13 of the 1789 Declaration;

27. Considering that Article 4 does not otherwise breach the requirements resulting from the tenth subparagraph of the Preamble to the 1946 Constitution; that it must be ruled constitutional;

ARTICLE 6:

28. Considering that subparagraph 3 of Article 83 of the General Tax Code applies to business expenses deductible from income for the purpose of determining the amount liable to income tax; that Article 6 inserts two indents into subparagraph 3 regarding the assessment of travel costs other than tolls, garage or parking charges and annual interest charged on the purchase of a vehicle; that it incorporates into the law the principle that the scale should be dependent upon the distance travelled annually and the administrative engine power, up to the limit of seven tax horsepower;

29. Considering that, according to the applicants, in excluding self-employed workers from this measure which is intended to promote the use of less polluting vehicles, these provisions breach the principle of equality before the law;

30. Considering that, for the purposes of determining the amount liable to income tax, the situation of a salaried employee is not identical to that of a self-employed worker; that accordingly, the objection alleging that the procedures for setting business expenses deductible from income and salaries are not applicable to non-employee workers must be rejected; that Article 6, which does not violate any requirement of constitutional law, must be ruled constitutional;

ARTICLE 8:

31. Considering that Article 8 relates to donations by natural persons to political parties; that its principal objective, set forth in paragraph I, is to amend the first subparagraph of Article 11-4 of the aforementioned Law no. 88-227 of 11 March 1988 in order to prevent the same natural person from donating more than 7,500 Euros to one or more political parties during any given year; that paragraph II of that Article amends the first indent of subparagraph 3 of Article 200 of the General Tax Code in order to set, as a consequence of the former, at 7,500 Euros the maximum amount which may be donated to political parties eligible for tax relief;

32. Considering that, according to the applicant Members of Parliament, paragraph I of this Article has no place in a law on finances; that this Article moreover violates the requirement of pluralism of ideas and opinions;

33. Considering in the first place that paragraph I of Article 8, which provides for the amendment of the rules on the financing of politics by natural persons does not relate to the resources, expenditure, treasury, borrowing, debt, guarantees or accounting of the State; that it does not concern taxation of any nature imposed on legal persons other than the State; that it does not have the objective of allocating provisions to local government bodies or approving financial conventions; that it does not relate to the pecuniary liability regime for public service agents or the provision of information to and control by Parliament over the management of public resources; that accordingly, paragraph I of Article 8 falls outwith the scope of laws on finance as specified under the basic law of 1 August 2001; that it was adopted according to a procedure which was unconstitutional;

34. Considering in the second place that paragraph II of Article 8 sets at 7,500 Euros the maximum amount of donations to political parties eligible for tax relief pursuant to Article 200 of the General Tax Code; that it does not however alter the limit of donations and contributions to political parties eligible for tax relief pursuant to Article 200 of the General Tax Code, which remains at 15,000 Euros; that accordingly, the provisions of paragraph II of Article 8, which cannot be separated from paragraph I, have no place in a law on finances;

35. Considering that, accordingly, without any requirement to examine the other objection raised by the applicants, Article 8 must be ruled unconstitutional;

ARTICLE 9:

36. Considering that Article 9 has the principal objective of subjecting to income tax revenues distributed by companies and investment products by abolishing the ability to subject them to a flat-rate levy releasing them from liability to income tax; that it alters the portion of the general social contribution paid on income from assets and investment products which is deductible from the amount liable to income tax; that it also alters relief on dividends which are subject to income tax;

37. Considering that, according to the applicant Senators and Members of Parliament, by subjecting to income tax the amounts distributed by companies and investment products earned in 2012 in respect of which the taxpayer opted for the flat-rate levy releasing them from liability to income tax, Parliament adopted retroactive tax legislation which is not justified by a sufficient reason of general interest; that, according to the applicant Members of Parliament, the transformation of the flat-rate levy releasing them from liability to income tax into a down payment also violates the right of ownership and freedom of enterprise;

38. Considering that the applicant Members of Parliament also dispute the change to the portion of the general social contribution paid on income from assets and investment products which is deductible from the amount liable to income tax, which is claimed to result in inequality in relation to public charges;

39. Considering finally that the applicant Members of Parliament argue that the subjection to income tax of dividends and investment products violates the principle of equality in relation to public charges and that, on the one hand such income is subject to social charges at rates higher that the rates of social charges on income from employment and substitute income, and that on the other hand the scope of such liability to income tax is broader than that of income from employment and substitute income;

40. Considering in the first place that letter A of paragraph IV of Article 9 has the objective of subjecting to income tax for the year 2012, without exception, income from securities for which the flat-rate levies releasing such amounts from liability to income tax provided for under paragraph I of Articles 117-quater and 125 A of the General Tax code have been charged from 1 January 2012 onwards; that letter B of paragraph IV establishes a tax credit in respect of such levies for the purposes of determining income tax for the year 2012, in order to avoid the double taxation of this income;

41. Considering that pursuant to letter A of paragraph IV: "With effect from 1 January 2012, the levies provided for under paragraph I of Articles 117-quater and 125 A of the General Tax Code shall no longer exempt the income to which they are applied from income tax"; that, accordingly, the provisions of paragraph IV have the effect of retroactively changing the exemptive effect of the flat-rate levies provided for under paragraph I of Articles 117-quater and 125 A of the General Tax Code;

42. Considering that Parliament is at any time at liberty, when ruling on the matters within its competence, to amend earlier legislation or to repeal it and replace it with new legislation as the case may be; that when doing so, it cannot however deprive constitutional requirements of legal guarantees; that in particular, it would violate the guarantee of rights proclaimed by Article 16 of the 1789 Declaration of the Rights of Man and the Citizen if it were to impinge upon acquired rights in a manner not justified by a sufficient reason of general interest;

43. Considering that the provisions of paragraph IV would have the effect of increasing the taxes due in respect of income from securities received in 2012 from certain taxpayers notwithstanding that, in accordance with the law, those taxpayers have already paid a tax which releases them from any obligation to pay tax in relation to such income;

44. Considering that Parliament's intention to secure supplementary revenue in 2013 resulting from the reform of the system of taxation for income from securities does not constitute a sufficiently important reason of general interest in order to retroactively alter a tax which Parliament intended should have exemptive effect and which had already been paid; that accordingly, without any requirement to examine the other objections, paragraph IV of Article 9 must be ruled unconstitutional; that, in order to ensure coordination, it is also necessary to rule unconstitutional the phrase: "of letter E" in paragraph VI of the same Article and to limit, with regard to income earned in 2012, the application of subparagraph 2 of letter H of paragraph VI to the part remaining following the repeal of subparagraph 5 of paragraph 3 of Article 158 of the General Tax Code;

45. Considering secondly that subparagraph 2 of letter G of paragraph I of Article 9 lowers from 5.8% to 5.1% the portion of the general social contribution on income from assets and investment products which is eligible for tax relief on income earned during the year in which it was paid; that the rate of relief is thus identical to that of the general social contribution on income from gainful employment, even though the rate of the general social contribution on income from assets and investment products remains 0.7% higher than that of the general social contribution on income from gainful employment;

46. Considering that the principle of equality in relation to public charges does not preclude Parliament, in the exercise of its powers pursuant to Article 34 of the Constitution, from granting tax relief in respect of one tax for the purposes of another tax, or altering that relief, provided that in altering the charge incumbent upon taxpayers, it does not result in any inequality between them in relation to public charges;

47. Considering, with regard to the present case, that the reduction in the general social contribution on income from assets and investment products eligible for deduction from the amount liable to income tax has the effect of increasing tax revenue and enhancing the progressive nature of the overall taxation of the income of natural persons from assets and investment products; that this reduction in tax relief, which only applies to the general social contribution in respect of income from assets and investment products, will be limited; that its impact on the increase in the tax levied on income from assets and investment products which are liable to income tax will not accordingly have the effect that it may be deemed to create inequality in relation to public charges;

48. Considering thirdly that letter B, subparagraph 1 of letter E and subparagraph 1 of letter H of paragraph I of Article 9 subject dividends paid by companies and investment products to income tax; that it accordingly follows from travaux preparatoires that Parliament intended to bring the tax arrangements applicable to income from dividends and investment products into line with those applicable to income from gainful employment;

49. Considering that, whilst Parliament did not alter the social charges applicable to such income where the rates were higher than those applicable to income from employment, it made provision in subparagraph 2 of letter E of paragraph I for the possibility to establish an exemption from income tax subject to a flat-rate tax of 24%, provided that household income from investment does not exceed 2,000 Euros in any year; that, whilst in subparagraph 2 of letter H of paragraph I it abolished the annual allowance on income distributed by companies provided for under subparagraph 5 of paragraph 3 of Article 158 of the General Tax Code, it maintained the allowance of 40% on the gross amount of income distributed, as provided for under subparagraph 2 of paragraph 3 of Article 158;

50. Considering that the Constitutional Council does not have the same general power of appreciation and decision making as that of the Parliament; that it cannot consider whether the objectives which Parliament set itself could have been achieved in another manner, unless the procedures stipulated by law are manifestly inappropriate for the objective pursued; that the subjection to income tax of earnings from securities is subject to a certain number of adjustments and exceptions; that in thereby altering the charge incumbent upon taxpayers in receipt of income from securities, Parliament did not create any inequality in relation to public charges;

51. Considering finally that letters e and h of subparagraph 5 of letter E of paragraph I of Article 9 have the objective of increasing the rates of the levy establishing exemption from liability to taxation provided for under Article 125 A of the General Tax Code which apply to income from bonds and stocks where the tax authorities have not been informed of the identity of the beneficiary; that these bonds and stocks are moreover subject to the social charges on investment products provided for under Article 16 of the aforementioned Ordinance no. 96-50 of 24 January 1996 under Article L. 14-10-4 of the Code of Social Action and Families, Article 1600-0 F-bis of the General Tax Code and Articles L. 136-7 and L. 245-15 of the Social Security Code; that the alteration of the rates of the levy establishing exemption from liability to taxation provided for under Article 125 A of the General Tax Code has the effect of increasing the rate of taxation on income from these bonds and stocks to 90.5%; that accordingly, this change imposes on the holders of bonds and stocks whose identity has not been made known to the tax authorities a charge which is excessive having regard to this capacity to pay tax and which runs contrary to the principle of equality in relation to public charges; that accordingly, the provisions of letters e and h of subparagraph 5 of letter E of paragraph I of Article 9 must be ruled unconstitutional;

52. Considering that according to the above, letters e and h of subparagraph 5 of letter E of paragraph I, paragraph IV and the phrase: "of letter E" in paragraph VI must be ruled unconstitutional; that in order to ensure the intelligibility of paragraph VI, there are also grounds to limit the application of subparagraph 2 of letter H of this paragraph insofar as is compatible with the repeal of subparagraph 5 of paragraph 3 of Article 158 of the General Tax Code; that the remainder of Article 9 is constitutional;

ARTICLE 10:

53. Considering that Article 10 alters the taxation of capital gains from the sale of securities or shares; that in particular, it subjects these capital gains to income tax whilst stipulating an allowance for net gains on the sale of securities and shares, depending upon the period of time for which these stocks have been held; that at the same time, it makes provision for an optional flat-rate tax of 19% where the seller meets with certain prerequisites;

54. Considering that the applicant Members of Parliament object to the abolition of a form of taxation of capital gains on securities which had enabled specific consideration to be given to the exceptional nature of such capital gains; that the new form of taxation of this category of income would create inequality in relation to public charges in that it does not take account of taxpayers' capacity to pay tax;

55. Considering that the applicant Members of Parliament call into question the establishment of two different tax regimes depending upon whether or not the seller complies with certain prerequisites regarding the duration and level of shareholding and has exercised certain functions within the company; that this taxation, which is not based on objective and rational criteria related to the objective pursued, is claimed to violate the principle of equality in relation to public charges; that they also object to "the extreme unintelligibility" of the exceptional arrangements which do not enable taxpayers to ascertain with certainty whether or not they will be able to benefit from it;

56. Considering finally that the applicant Members of Parliament argue that the subjection to income tax of capital gains from the sale of securities where, on the one hand these capital gains are subject to social charges at rates higher that the rates of social charges on income from employment and substitute income, and on the other hand the scope of such liability to income tax is broader than that of income from employment and substitute income, creates inequality in relation to public charges;

57. Considering first that subparagraph 1 of letter N of paragraph I of Article 10 amends subparagraph 2 of Article 200 A of the General Tax Code, with the effect of subjecting capital gains on the sale of securities and shares to income tax; that letter E of paragraph I of Article 10 makes provision within subparagraph 1 of Article 150-0 D of the Code for progressive relief on the amount of net gains from the sale of securities subject to income tax depending upon the period of time for which these stocks have been held and the date of their sale; that this allowance may extend to 40% of the amount of net gains from the sale provided that the shares, stakes, rights or stocks have been held for at least six years; that the combination of the subjection to income tax with the allowance for the duration of the holding has the effect of significantly reducing the tax increase resulting from the provisions of Article 10;

58. Considering that by increasing the taxation of capital gains from the sale of securities whilst taking account of the period of time for which these stocks have been held in order to reduce the amount liable to income tax, Parliament did not establish forms of taxation which disregard taxpayers' capacity to pay tax;

59. Considering secondly that subparagraph 2 of letter N of paragraph I of Article 10 maintains, within subparagraph 2-bis of Article 200 A of the General Tax Code, an optional flat-rate tax of 19% on capital gains from the sale of stocks or shares in companies carrying on industrial, commercial, artisan, agricultural or professional activity, with the exclusion of activities procuring guaranteed income, financial activities, and real estate and securities asset management activities; that the seller must have held stocks or shares corresponding to at least 10% of the voting rights or rights to the company profits either directly or through a family member for a period of at least two years out of the ten years prior to the sale and must hold at least 2% of the voting rights or rights to the company profits on the date of the sale; that the seller must have carried on certain management or control functions within the company or have been an employee of the company on a continuous basis for five years prior to the sale;

60. Considering that according to the parliamentary work following which this provision was introduced into Article 10 that, in establishing exemption regime, Parliament intended to lay down measures which would incentivise the development of economic activities by applying objective and rational criteria in line with the goals pursued; that the Constitutional Council does not have the same general power of appreciation and decision making as that of the Parliament; that it cannot consider whether the objectives which Parliament set itself could have been achieved in another manner, unless the procedures stipulated by law are manifestly inappropriate for the objective pursued; that the eligibility criteria chosen for the 19% flat-rate tax regime relate to the field of activity of the company the shares or rights in which have been sold, the period of time for which these stocks have been held, the proportion of these stocks out of the voting rights or rights to company profits and the exercise of certain management or control functions or the salaried employment by the company on a continuous basis for five years prior to the sale; that these criteria, which are not unintelligible, are objective and rational; that they are related to the objective pursued by Parliament;

61. Considering that provision granting exemption from taxation to which taxpayers which meet with the aforementioned prerequisites may be eligible cannot be cumulated with the allowance for the duration of the holding provided for under subparagraph 1 of Article 150-0 D of the General Tax Code, even though it is subject to conditions relating to the duration of the holding; that accordingly this beneficial tax regime no longer appears to be disproportionate having regard to the objective pursued;

62. Considering that, under these conditions, the provisions of subparagraph 2 of letter N of paragraph I of Article 10 do not violate the principle of equality in relation to public charges and do not breach any other requirement of constitutional law;

63. Considering, thirdly, that according to the travaux preparatoires, in subjecting capital gains from the sale of securities to income tax, Parliament intended to bring the tax arrangements applicable to income from capital gains into line with those applicable to income from gainful employment;

64. Considering that, whilst Parliament did not alter the social charges applicable to such income where the rates were higher than those applicable to income from gainful employment, it made provision in letter E of paragraph I for progressive relief from income tax depending upon the period of time for which the shares, stakes, rights or stocks sold were held; that in letter F of paragraph I, it also adjusted a tax deferral scheme in relation to income tax falling under Article 150-0 D-bis of the General Tax Code; that in letter B of paragraph III it extended the effects of an allowance provided for under Article 150-0 D-ter of the same Code; that finally, as mentioned above, in subparagraph 2 of letter N or paragraph I of Article 200 A of the Code it established, creating subparagraph 2-bis, an exemption from taxation subject to a flat-rate tax of 19 % where certain prerequisites are met;

65. Considering that the Constitutional Council does not have the same general power of appreciation and decision-making as that of the Parliament; that it cannot consider whether the objectives which Parliament set itself could have been achieved in another manner, unless the procedures stipulated by law are manifestly inappropriate for the objective pursued; that the extension of the applicability of income tax to include capital gains from the sale of securities is subject to a certain number of adjustments and exemptions; that in thereby altering the charges levied on taxpayers who have earned capital gains from the sale of securities, Parliament did not create any inequality in relation to public charges;

66. Considering that according to the above, Article 10 is constitutional;

ARTICLE 12:

67. Considering that paragraph I of Article 12 introduces section 0I-bis entitled "Exceptional solidarity contribution on extremely high incomes from gainful employment", including Article 223-sexies A, after section 0I of chapter III of title I of part one of book I of the General Tax Code; that paragraph I of this Article imposes, subject to the conditions set forth in Article 4 A of the General Tax Code, an exceptional contribution on natural persons of 18% on the portion of their income from gainful employment exceeding one million Euros and specifies the income which is to be taken into account for the purpose of establishing this contribution; that paragraph II of Article 223-sexies A provides that the contribution shall be declared, determined, controlled and recovered in accordance with the same rules and subject to the same guarantees and sanctions as are applicable to income tax; that paragraph II of Article 12 of the law referred stipulates that the provisions of paragraph I shall apply to income from 2012 and 2013;

68. Considering that, according to the applicant Members of Parliament and Senators, when added to the maximum marginal rate of income tax provided for under Article 3 of the Law on finances for 2013, as well as the exceptional contribution on high incomes and social charges, this exceptional contribution will result in a global rate of taxation of 75% and hence has confiscatory effect; that this exceptional contribution also violates the principle of equality in the payment of public dues resulting from Article 13 of the 1789 Declaration by considering natural persons and not households as the basis for taxation, by not providing for a capping or relief mechanism and not taking account of family costs; that the principle of equality between taxpayers in accordance with the nature of the income which they earn is further violated in particular in that only income from gainful employment, and not income from assets, is subject to the exceptional contribution; that, according to the applicant Members of Parliament, the breach of the principle of equality is further aggravated in that this tax applies to capital gains resulting from the exercise of options to purchase or to subscribe to shares or the allocation for no consideration of shares depending upon whether the gains result from plans allocated before or after 16 October 2007; that the applicant Members of Parliament also assert that this contribution, which cannot be separated from income tax itself, thus deprives taxpayers of their private property; that the establishment of such a contribution contravenes the principle that tax should be calculated annually and failed to take account of the requirements of clarity and sincerity within the parliamentary debate;

69. Considering that Article 6 of the 1789 Declaration provides: “The law···must be the same for all, whether it protects or punishes”; that the principle of equality does neither prevent the legislator to settle different situations in different ways, nor does it derogate from equality in the general interest, provided that in both cases the resulting difference in treatment is directly related to the subject matter of the law providing for the different treatment;

70. Considering that Article 13 of the 1789 Declaration provides: “A common contribution is essential for the maintenance of the public forces and for the cost of administration. This should be equitably distributed among all the citizens in proportion to their means”; that this requirement will not be respected if the tax is confiscatory in nature or imposes an excessive burden on a category of taxpayers, taking account of their capacity to pay tax; that pursuant to Article 34 of the Constitution, it is for Parliament to determine, in accordance with constitutional principles and taking account of the characteristics of each tax, the rules according to which the capacity to pay tax must be assessed; that in particular, in order to ensure that the principle of equality is respected, it must base its assessment on objective and rational criteria intended to further the goals it proposes; that this assessment may not however entail any clear breach of the principle of equality in the payment of public dues;

71. Considering that in establishing the exceptional solidarity contribution on very high incomes from gainful employment, Parliament imposed a tax for income for 2012 and 2013 based solely on income from gainful employment; that in order to levy that exceptional contribution, it decided to impose a marginal rate of income tax of 18%, charged on the portion of income exceeding the threshold of one million Euros per natural person;

72. Considering that income from gainful employment which is taken into account for the purposes of determining this exceptional contribution includes remuneration and salary as defined under Article 79 of the General Tax Code, with the exclusion of unemployment and early retirement benefit and the dividends and capital gains referred to under Article 80-quindecies of the General Tax Code, remuneration allocated to the managers and shareholders of limited liability companies and equivalent undertakings, industrial or commercial profits, non-commercial profits and agricultural profits where resulting from an activity carried out on a professional basis, economic benefits resulting from the allocation of shares for no consideration and capital gains resulting from the exercise of options to buy or to subscribe to shares with the exception of those which, in respect of shares allocated after 16 October 2007, are subject to the contribution under Article L. 137-14 of the Social Security Code; that this income is already subject to tax based on household income;

73. Considering that Parliament decided to adopt the principle of taxation of income with reference to the natural person without taking account of household income; that as a result of this exceptional contribution based on the income from gainful employment of natural persons exceeding one million Euros, two households in receipt of the same level of income from gainful employment could either be subject to this contribution or by contrast be exempt from it, depending upon the division of income between the taxpayers comprising the household; that accordingly, in applying this exceptional contribution to natural persons without taking account of the existence of the household when subjecting overall earnings to income tax and the exceptional contribution provided for under Article 223-sexies of the General Tax Code, Parliament disregarded the requirement to take account of the capacity to pay tax; that it accordingly violated the principle of equality in relation to public charges;

74. Considering that according to the above, without any requirement to examine the other challenges, in particular those alleging that the "threshold effect" and confiscatory nature of this tax violate the principle of equality in relation to public charges, Article 12 must be ruled unconstitutional;

ARTICLE 11:

75. Considering that Article 11 alters the tax on capital gains and economic benefits resulting from the exercise of an option to subscribe to or to purchase shares or from the acquisition of shares for no consideration allocated after 28 September 2012, stipulating that they are to be subject to income tax;

76. Considering that the applicant Members of Parliament object to the new regime governing the taxation of capital gains relating to plans providing the option to subscribe to or purchase shares and economic benefits corresponding to the value of shares allocated for no consideration; that in subjecting the recipients of these capital gains and economic benefits to a global levy which is higher than that applicable to remuneration and salaries, this regime of taxation creates inequality in relation to public charges; that it also violates the right of ownership;

77. Considering in the first place that according to the travaux preparatoires, in subjecting capital gains and economic benefits resulting from the exercise of an option to subscribe to or to purchase shares or the acquisition of shares for no consideration allocated after 28 September 2012 to income tax, Parliament intended to bring the tax arrangements applicable to income from these capital gains and economic benefits into line with those applicable to income from employment;

78. Considering that at the same time Parliament amended the social charges applicable to these capital gains and economic benefits; that letter A of paragraph II of Article 11 subjects them to the general social contribution on income from gainful employment provided for under Article L. 136-1 of the Social Security Code and no longer subjects them to the social charges on income from assets and investment products; that letter D of paragraph II of Article 11 amends the rate of salary contribution on the allocation of options to subscribe to or to purchase shares and on the allocation of shares for no consideration; that subparagraph 5 of letter A and letter B of paragraph I of Article 11 continue to permit the offsetting of capital losses on sales against capital gains and economic benefits resulting from the acquisition of shares;

79. Considering that the Constitutional Council does not have the same general power of appreciation and decision making as that of the Parliament; that it cannot consider whether the objectives which Parliament set itself could have been achieved in another manner, unless the procedures stipulated by law are manifestly inappropriate for the objective pursued; that the subjection to income tax of earnings from economic benefits resulting from the exercise of an option to subscribe to or to purchase shares or from the acquisition of shares for no consideration is subject to a certain number of adjustments; that in thereby altering the charge levied on taxpayers in receipt of capital gains and economic benefits resulting from the exercise of an option to subscribe to or to purchase shares or from the acquisition of shares for no consideration allocated after 28 September 2012, Parliament did not create any inequality in relation to public charges;

80. Considering secondly that subparagraph 2 of letter D of paragraph II of Article 11 has the objective of raising the salary contribution rate provided for under Article L. 137-14 of the Social Security Code to 17.5% and, if the shares purchased are not restricted for a certain period of time, to 22.5%; that the capital gains and economic benefits resulting from the exercise of an option to subscribe to or to purchase shares or from the allocation of shares for no consideration are moreover taxed as remuneration and salary pursuant to Articles 80-bis and 80-quaterdecies of the General Tax Code, as amended respectively by subparagraph 1 of letter A of paragraph I and letter B of paragraph I of Article 11; that these economic benefits are moreover subject to the general social contribution pursuant to Articles L. 136-2, L. 136-5 and L. 136-6 of the Social Security Code as amended by letters A, B and C of paragraph II of Article 11 and, consequently, to the contribution for the repayment of the health service debt provided for under Article 14 of Ordinance no. 96-50 of 24 January 1996;

81. Considering that the rates of 17.5% and 22.5% provided for respectively under second and third indents of subparagraph 2 of letter D of paragraph II of Article 11, in conjunction with the other overall rates of taxation of capital gains and economic benefits applicable to the exercise of an option to subscribe to or to purchase shares or to to the allocation of shares for no consideration have the effect, after taking into account the eligibility for relief of a portion of the general social contribution for the purposes of income tax, of increasing the maximum marginal rate of taxation on these capital gains and economic benefits respectively to 72% and 77%; that, where a taxpayer's other income subject to income tax exceeds 150,000 Euros for an unmarried taxpayer, the rate of taxation of these capital gains and economic benefits will increase at least to 68.2% or to 73.2%; that consequently, the new rates of taxation resulting from the increase of the contribution provided for under Article L. 137-14 of the Social Security Code impose an excessive burden on taxpayers having regard to this capacity to pay tax; that these rates breach the principle of equality in relation to public charges; that accordingly, the overall amendments made to Article L. 137-14 of the Social Security Code provided for under letter D of paragraph II of Article 11 are unconstitutional;

82. Considering, thirdly, that pursuant to letter b of subparagraph 1 of letter A of paragraph I of Article 11, an indent has been introduced into paragraph I of Article 80-bis of the General Tax Code according to which: "The purchase price of shares acquired prior to 1 January 1990 shall be deemed to be equal to the value of the share on the date on which the option was exercised. » ;

83. Considering that it is for Parliament to exercise to the full the powers vested in it by the Constitution, including in particular Article 34; that the objective of constitutional standing that the Law should be accessible and intelligible, as resulting from Articles 4, 5, 6 and 16 of the 1789 Declaration, requires it to adopt provisions which are sufficiently precise and unequivocal;

84. Considering in this case that, in adopting the aforementioned provisions, Parliament intended to specify the rules for determining capital gains resulting from the exercise of an option to subscribe to or to purchase shares which are subject to taxation pursuant to Article 80-bis of the General Tax Code; that these provisions must be read in conjunction with paragraph IV of Article 11, which provides that paragraphs I to III shall apply to options on stocks and shares allocated for no consideration after 28 September 2012; that, due to their contradictory nature, they violate the objective of constitutional standing that the Law should be accessible and intelligible; that, under these conditions, letter b of subparagraph 1 of letter A of paragraph I of Article 11 must be ruled unconstitutional;

85. Considering that it follows from the above that letter b of subparagraph 1 of letter A of paragraph I and letter D of paragraph II of Article 11 must be ruled unconstitutional; that the remainder of Article 11 is constitutional;

ARTICLE 13:

86. Considering that paragraph I of Article 13 reforms certain provisions of the General Tax Code governing the solidarity tax on wealth due from the year 2013 onwards; that individuals who own assets exceeding 1.3 million Euros shall be subject to this tax; that in particular letter C of paragraph I amends Article 885 O-ter of the General Tax Code to the effect of enabling company assets which are not necessary for industrial, commercial, craft, agricultural or professional activities to be taken into account as assets of partners or shareholders; that letter D of paragraph I amends Article 885 U of the same Code on the rate of this tax; that it subjects portions of wealth exceeding 0.8 million, 1.3 million, 2.57 million, 5 million and 10 million Euros to rates respectively of 0.5%, 0.7%, 1%, 1.25% and 1.50%; that letter E of paragraph I repeals Article 885 V on tax reduction of 300 Euros per dependent person;

87. Considering that letter F of paragraph I re-enacted into the General Tax Code Article 885 V-bis which lays down the upper limit on the solidarity tax on wealth based on the amount of that tax and the taxes due in France and abroad in respect of income and profits from the previous year; that this upper limit is set at "75% of the total amount of income earned worldwide net of business expenses arising in the previous year after deduction only of the category-based tax losses which may be offset under Article 156, as well as income exempt from income tax and profits and subject to a levy establishing exemption from liability to taxation generated in the same year in France or outside France";

88. Considering that paragraph II of Article 885 V-bis provides that, for the purposes of calculating the limit, "the following shall be considered in the same manner as income generated during the same year in France or outside France:

"1. Interest on house purchase savings plans, with respect to the amount specified under letter c of subparagraph 2 of paragraph II of Article L. 136-7 of the Social Security Code;

"2. Changes in the repurchase value of capitalisation bonds or contracts or other similar investments, including in particular life assurance, as well as financial instruments of any kind aimed at capitalising income subscribed to with undertakings established in France or outside France between 1 January and 31 December of the previous year net of contributions and repurchases made between the same dates;

"3. Profits capitalised in trusts defined under Article 792-0-bis of this Code between 1 January and 31 December of the previous year;

"4. For the holders of stakes or shares in a company which is liable to corporation tax, and in proportion with the rights to a share of the profits of the company, the distributable benefits pursuant to Article L. 232-11 of the Commercial Code from the last financial year ending between 1 January and 31 December of the previous year, reduced by the allowance referred to in this Article and increased by amounts which are to be allocated to reserves in accordance with the articles of association and costs incurred to the benefit of the holders. The payments relating to the financial benefits taken into account for the purposes of this subparagraph shall not be taken into account for the purposes of paragraph I.

"This subparagraph shall apply where the company has been controlled by the person liable to tax at any time during the course of the previous five years. For the purposes of the application of this condition, a person liable to tax shall be deemed to control a company:

"a) Where the majority of the voting rights or rights to the company profits is held directly or indirectly by the person liable to tax or by his or her spouse or partner or their ascendants or descendants or brothers or sisters;

"b) Where he only holds a majority of the voting rights or rights to the company profits by virtue of an agreement concluded with the other partners or shareholders;

"c) Where he exercises de facto power of decision.

"The taxpayer shall be deemed to exercise control if he holds directly or indirectly a portion of the voting rights or of the rights to company profits of 33.33% or higher, provided that no other partner or shareholder holds directly or indirection a portion higher than his own.

"The taxpayer and one or more persons acting in concert shall be deemed to exercise joint control over a company when they de facto control the decisions adopted by the general meeting;

"5. Capital gains which gave rise to tax relief for the year of the transaction which gave rise to that relief, as well as net capital gains subject to a tax deferral";

89. Considering that, according to the applicant Senators and Members of Parliament, these provisions violate the principle of equality in relation to taxation and public charges, as well as private property rights; that they argue that, taking account of the low level of return on fixed-yield investments, the alignment of tax arrangements applicable to income from capital assets with those applicable to income from employment and the establishment of a new marginal rate of income tax of 45%, these provisions result in the confiscation of all income from capital assets and part of the income from employment; that they argue furthermore that in incorporating into the calculation of the upper limit for tax of deferred income which has not yet been generated and hence which the taxpayer does not freely dispose of, these provisions incorrectly assess the capacity to pay tax; that the applicant Members of Parliament also object to the abolition of the tax reduction of 300 Euros for each dependent person, as well as the complete failure to take account of resulting costs to families, and argue that the upper limit for the solidarity tax on wealth should be calculated solely with reference to income from capital assets;

90. Considering first that the solidarity tax on wealth does not feature amongst the taxes on income; that in establishing this tax, Parliament intended to target the capacity to pay tax which is conferred by the holding of a body of assets and rights; that the taking into account of this capacity to pay tax does not imply either that only goods which generate income should fall within the amount liable for the solidarity tax on wealth, or that this tax should only be paid in respect of income from taxable assets;

91. Considering that, if Parliament was able to increase the number of tax bands and to raise the rate of taxation applicable to assets whilst at the same time subjecting income from capital assets to income tax and that it maintained the particular rates of social charges on income from capital assets, this was due to the setting at 1.5% of the maximum marginal rate and the maintenance of the full or partial exclusion for numerous assets and rights from the purview of this tax; that under these conditions, the rate of 1.5% applicable to the portion of that net taxable value of wealth exceeding ten million Euros takes account of the capacity to pay tax of individuals who hold such assets; that in particular, contrary to the assertions of the applicant Members of Parliament, its effects on the assets of these taxpayers are not such as to violate their rights of ownership;

92. Considering, secondly, that in creating the solidarity tax on wealth, Parliament considered that the composition of the household did not have the same impact for the purposes of determining its capacity to pay tax as it does in relation to income tax; that it decided in favour of the principle of taxation according to household without taking account of a family allowance mechanism; that in taking account of capacity to pay tax according to other mechanisms, it did not violate the requirement resulting from Article 13 of the 1789 Declaration, which does not require the that a family allowance be granted; that accordingly, in repealing Article 885 V of the General Tax Code, it did not violate the principle of equality in relation to public charges;

93. Considering thirdly that in re-enacting rules applicable to the upper limit into Article 885 V-bis of the above Code which do not carry out a calculation on a tax-by-tax basis and which limit the amount of the solidarity tax on wealth and taxes due in relation to income and profits from the previous year to a proportion of the total income from the previous year, Parliament was able to avoid the violation of the principle of equality in relation to public charges which would have occurred without such an upper limit; that in setting that proportion at 75%, it did not violate the constitutional requirements referred to above;

94. Considering that, with regard to the calculation of the upper limit, the provisions of paragraph II of Article 885 V-bis include within the taxpayer's income capitalised interest and profits, financial benefits provided by financial companies and capital gains subject to a tax allowance or deferral;

95. Considering however that in incorporating amounts which do not consist in financial benefits or income which the taxpayer has generated or of which he has disposed during the financial year into the taxpayer's relevant income for the calculation of the upper limit for the solidarity tax on wealth and for all taxes due in respect of income, Parliament based its assessment on criteria which violate the requirement to take account of the capacity to pay tax; that accordingly, the third and sixth subparagraphs of letter F of paragraph I of Article 13 must be ruled unconstitutional; that the same applies in the seventeenth subparagraph of letter F to the words: ", including those referred to in subparagraph 5 of paragraph II,";

96. Considering that, similarly, whilst Parliament was able to take account of the fraction of the value of stakes or shares corresponding to company assets which are not necessary for industrial, commercial, artisan, agricultural or professional activity of the company when determining the non-professional assets of taxpayers, it could not base the solidarity tax on wealth on these company assets up to the limit of the percentage held by the latter where it has not been established that these assets are in actual fact available to the shareholder or partner; that Parliament designated taxable assets which bore no relation with the capacity to pay tax; that accordingly, letter C of paragraph I of Article 13 must also be ruled unconstitutional;

97. Considering that the remainder of Article 13 is constitutional;

ARTICLE 15:

98. Considering that Article 15 sets forth the regime of taxation of capital gains on real estate; that on the one hand it subjects capital gains generated following the sale of building land, with respect to sales concluded after 1 January 2015, to the progressive scale of income tax; that in particular, it inserts Article 150 VH-bis after Article 150 VH of the General Tax Code, which provides that "tax on income comprised of capital gains generated following the sale of building land referred to under paragraph I of Article 150 VC or of associated rights which is due subject to the conditions set forth under Articles 150 VF to 150 VH shall not have the effect of establishing exemption from the tax on net global income provided for under Article 158" and adds a paragraph II into Article 200 B of the Code which provides that the capital gains referred to under Article 150 VH-bis shall be taken into account for the purposes of determining net global income pursuant to Article 158; that on the other hand, by amending the first subparagraph of paragraph I of Article 150 VC and paragraph II of Article 150 VD of the General Tax Code, Article 15 abolishes any relief based on the duration of the holding for sales of building land concluded after 1 January 2013; that however, pursuant to letter B of paragraph IV of Article 15, this provision does not apply to capital gains for which a binding commitment to sell was made before 1 January 2013 where the deed of sale is signed before 1 January 2015; that moreover, paragraph II of Article 15 maintains relief for 20% of net taxable capital gains on sales of real estate rights and assets other than building land concluded in 2013; that finally, pursuant to paragraph III of Article 15, capital gains generated following the sale of properties to bodies managing social housing or to a local government body, a public body for inter-municipal cooperation or a public real estate establishment under State ownership shall be exempt in view of their sale to the aforementioned bodies, provided that the assets are sold before 31 December 2014;

99. Considering that the applicant Members of Parliament argue that the global taxation of capital gains from real estate generated following the sale of building land is confiscatory in nature; that in providing for a difference in taxation within the category of capital gains from real estate between building land subject to income tax and other real estate assets, Parliament violated the principle of equality in relation to public charges; that in not providing for any relief based on the period of time for which building land was held, Parliament did not take account of taxpayers' real capacity to pay tax; that the exemption of capital gains from real estate provided where the sales are made to a social landlord in order to create social housing, whereas no such exemption is granted to private landlords, violates the principle of equality in relation to taxation; that finally, the provision is unintelligible;

100. Considering that according to the preparatory work, Parliament intended to amend the regime of taxation for capital gains from real estate generated following the sale of building land in order to increase tax revenue and to combat the retention of property resources by owners; that to this effect, it subjected capital gains generated following the sale of building land for sales concluded after 1 January 2015 to income tax, and no longer to a flat-rate levy of 19%; that it abolished all relief based on the period of time for which the property was held with effect from 1 January 2013, with the exception of sales where a commitment to sell was made before that date, provided that the deed of sale is signed before 1 January 2015;

101. Considering however that capital gains from real estate on building land will be subject to income tax as amended by Article 3 of the law referred, to the exceptional contribution on high incomes provided for under Article 223-sexies of the General Tax Code, to the social charges provided for under Article 16 of Ordinance no. 96-50 of 24 January 1996, Article L. 14-10-4 of the Code of Social Action and Families, Article 1600-0 F-bis of the General Tax Code and Articles L. 136-7 and L. 245-15 of the Social Security Code, to the mandatory tax paid to the Services and Payments Agency pursuant to Article 1605-nonies of the General Tax Code and, as the case may be, to one of the alternative optional taxes which the municipalities may establish pursuant to Article 1529 of the Code or the authority responsible for local transport, pursuant to Article 1609-nonies F of the Code; that, after deduction of a portion of the general social contribution, these provisions may result in a marginal rate of taxation of 82% which would have the effect of imposing an excessive charge on a category of taxpayers having regard to this capacity to pay tax; that under these conditions, the provisions of Article 15 of the Law referred violate the principle of equality in relation to public charges;

102. Considering that according to the above, Article 15 must be ruled unconstitutional;

ARTICLES 22, 23 AND 24:

103. Considering that Article 22, on the tax regime governing capital gains from the sale of equity interests, alters the procedure for calculating the quota-share of costs and charges for reinstatement into the amount liable to taxation at the normal rate of corporation tax; that in amending the fourth subparagraph of Article 223 F of the General Tax Code, its specific objective is to calculate this quota-share on the gross amount of the capital gains generated by undertakings, and no longer on the net result of capital gains on sales;

104. Considering that Article 23 introduces changes to the regime governing the deductibility of financial charges from taxable profits for companies subject to corporation tax; that it inserts Article 212-bis into the General Tax Code according to which "net financial charges relating to amounts provided to or made available to an undertaking which is not a member of a group for the purposes of Article 223 A shall be reinstated into profits with regard to a portion equal to 15% of their amount"; that it also inserts Article 223 B-bis into the same Code which makes the same provision for companies which are members of a group for the purposes of Article 223 A of the General Tax Code; that these provisions, which have the object of establishing a ceiling on the amount of financial charges which undertakings may deduct from their taxable profits, do not apply when the total amount of net financial charges, depending upon the circumstances either for the undertaking or for the group, is lower than three million Euros; that they no longer apply to financial charges which are incurred in particular by the private agents, concession holders and partners or public or private partnerships in relation to agency, concession or partnership agreements signed on or before the date of promulgation of the Law on finances for 2013; that under the terms of paragraph IV of Article 23, the 15% rate will be increased to 25% for financial years starting after 1 January 2014;

105. Considering that Article 24 introduces changes to the mechanism for carrying forward losses for companies which are subject to corporation tax by replacing the 50% rate with a 60% rate in the first phrase of the third subparagraph of paragraph I of Article 209 of the General Tax Code; that the offsetting of prior losses against profits reported for a financial year will only be possible in future up to the limit of one million Euros plus 50% of the amount corresponding to the taxable profit for the said financial year exceeding the former amount;

106. Considering that the applicant Senators argue that these provisions, which are retroactive in nature, violate the principle of legal certainty for taxpayers by altering the tax arrangements applicable to transactions in progress and legitimate expectations guaranteed under Articles 2 and 16 of the 1789 Declaration;

107. Considering that Parliament is at any time at liberty, when ruling on the matters within its competence, to amend earlier legislation or to repeal it and replace it with new legislation as the case may be; that when doing so, it cannot however deprive constitutional requirements of legal guarantees; that in particular, it would violate the guarantee of rights proclaimed by Article 16 of the 1789 Declaration of the Rights of Man and the Citizen if it were to impinge upon acquired rights in a manner not justified by a sufficient reason of general interest;

108. Considering that the provisions of Articles 22, 23 and 24 of the law referred, which apply to taxes which will be due in 2013 for the year 2012, alter tax benefits previously granted, the maintenance of which is not required by any rule of constitutional law; that they do not affect legally acquired interests and do not accordingly run contrary to the guarantee of rights proclaimed by Article 16 of the 1789 Declaration;

109. Considering that according to the above, Articles 22, 23 and 24, which do not breach any requirement of constitutional law, must be ruled constitutional;

ARTICLE 25:

110. Considering that Article 25 establishes a complementary contribution to the exceptional tax on the capitalisation reserve defined under Article 23 of the aforementioned Law no. 2010-1657 of 29 December 2010; that insurance companies, mutual benefit societies and pension schemes conducting an undertaking in France are liable to pay this contribution; that the amount liable to the contribution is that of the capitalisation reserve of these companies, determined in accordance with the procedures laid down in the second subparagraph of paragraph I of Article 23; that the rate of this contribution is 7%;

111. Considering that, according to the applicant Members of Parliament, this contribution amounts to a "concealed tax on the holders of life assurance"; that Parliament thus disregarded the objective of constitutional standing that the law be accessible and intelligible; that moreover, the determination of the amount liable to this contribution is claimed to result in differences in treatment between insurance companies, in breach of the principle of equality before the law;

112. Considering that according to the preparatory work, in establishing this complementary contribution to the taxation of capitalisation reserves of insurance companies, Parliament intended to increase the tax revenue originating from the taxation of insurance companies; that, according to the provisions of Article 25, it defined the amount liable to taxation, the rate and the procedures governing the collection of this new tax; that in imposing this tax on the insurance companies referred to in subparagraphs 1 to 6 of paragraph I of Article L. 612-2 of the Monetary and Financial Code conducting an undertaking in France, it did not subject individuals in an identical situation to different rules; that these provisions are not unintelligible; that it follows that the objections must be rejected; that Article 25, which does not violate any other requirement of constitutional law, must be ruled constitutional;

PARAGRAPH I OF ARTICLE 51:

113. Considering that subparagraph 1 of paragraph I of Article 51 inserts a new Article L. 3211-5-1 into the General Code Regulating the Property of Public Bodies which amends the legal regime governing the sale of real estate built by the State located in a national forest; that subparagraph 2 of paragraph I completes Article L. 3211-21 of the same Code and defines the procedures governing the exchange of woods and forests and of real estate built by the State located in these forests;

114. Considering that, according to the applicant Members of Parliament, paragraph I of this Article has no place in a law on finances;

115. Considering that paragraph I of Article 51, which provides for an amendment to the rules governing the conditions under which real estate owned by the State may be transferred or exchanged, relates to State resources; that accordingly, paragraph I of Article 51 may be included in a law on finances; that it was adopted according to a procedure which was constitutional;

ARTICLE 73:

116. Considering that Article 200-0 A of the General Tax Code lays down a global limitation on the tax benefit resulting from certain tax deductions, reductions and credits with regard to income tax; that, as applicable prior to the deferred law, this upper limit has the effect that the total value of tax benefits considered cannot result in a reduction in the amount of tax owed in excess of 18,000 Euros or 4% of taxable income;

117. Considering that letter A of paragraph I of Article 73 reformulates paragraph 1 of Article 200-0 A; that the first subparagraph of paragraph 1 sets at 10,000 Euros the upper limit on the reduction of income tax which certain tax benefits may secure; that this upper limit does not however apply to the benefits referred to under Articles 199-undecies A, 199-undecies B, 199-undecies C and 199-unvicies, which are applicable to tax reductions granted on the grounds, respectively of overseas real estate investments, overseas manufacturing investments, overseas investments in social housing and investments in limited liability companies which have as their exclusive activity the capital financing of cinema and audio-visual works; that, for these four exemptions, the second subparagraph of paragraph 1 provides for an increase in the upper limit of the amount to 18,000 Euros or 4% of taxable income; that moreover, certain tax benefits continue to be exempt from any global upper limit; that this applies in particular to the tax reduction provided for under Article 199-tervicies granted with regard to costs incurred for the purpose of the full renovation of property built within conservation areas, derelict historical districts and protected areas, which are subject to their own lump-sum limit;

118. Considering that the applicant Members of Parliament argue that in excluding certain tax benefits from this overall upper limit and in creating two distinct upper limits, one lump-sum and the other lump-sum but proportional to taxable income, these provisions violate the principle of equality before the law and in relation to public charges; that moreover, the complexity of this provision violates the objective of constitutional standing that the law should be accessible and intelligible; that the applicant Senators consider that in applying the reduction of the upper limit to real estate transactions in progress, these provisions have a retroactive effect which violates the principle of legal certainty;

119. Considering in the first place that the complexity of the law cannot on its own result in a violation of the objective of constitutional standing that the law should be accessible and intelligible; that the provisions of Article 73 do not disregard this objective;

120. Considering secondly that according to the preparatory work, in adopting Article 73 Parliament intended to enhance the fairness of this provision and to better assure the progressive nature of the tax; that at the same time, it endeavoured to avoid weakening the incentive within certain provisions providing for tax reductions and credits with a view in particular to promoting employment and the supply of social housing overseas as well as the restoration of developed properties;

121. Considering that Parliament is at liberty, having regard to the goals it sets itself, to set different limits on the tax benefits which it establishes, provided that it bases its decision on objective and rational criteria which are related to the goals pursued and that it does not create any violation of the principle of equality in relation to public charges;

122. Considering however that, on the one hand, the law referred imposes a significant increase in income tax; that on the other hand, the first subparagraph of paragraph 1 of Article 200-0 A, following the enactment of Article 73, sets the global upper limit for most tax benefits as a lump-sum amount; that in leaving at the same time an upper limit expressed as a proportion of taxable revenue which applies to two classes of tax benefit relating to investment transactions, Parliament enabled certain taxpayers to limit the progressive nature of this tax on income under conditions which result in a violation of the principle of equality in relation to public charges:

123. Considering consequently that in the fourth subparagraph of Article 73, the words "and of an amount equal to 4 % of the taxable income used as a basis for calculating the tax on earnings under the conditions set forth in paragraph I of Article 197" must be ruled unconstitutional; that with regard to the remainder, the provisions of Article 73, which do not in any case have retroactive effect, do not violate any constitutional requirement and must be ruled constitutional;

ARTICLE 104:

124. Considering that paragraph I of Article 104 inserts a new paragraph I-bis into Article L. 515-19 of the Environmental Code which defines the conditions under which the operators of installations giving rise to risks and local authorities or groupings thereof which may participate in the financing of works required to be undertaken by national persons who are homeowners in areas in relation to which a technological risk prevention plan has been approved; that paragraph II amends Article 200-quater A of the General Tax Code in order to neutralise the effect of these participations on costs which are eligible to benefit from the tax credit provided for under this Article and on the recovery of amounts repaid;

125. Considering that, according to the applicant Members of Parliament, this Article has no place in a law on finances;

126. Considering in the first place that paragraph I of Article 104, which defined the conditions governing participation by private individuals in local government bodies or groupings thereof in the financing of works on private residences does not relate to resources, charges, finances, borrowing, debt, guarantees or the accounts of the State; that has not affected taxes of any kind imposed on legal persons other than the State; that it does not have the objective of reallocating funds to local authorities or approving financial conventions; that it does not relate to the pecuniary liability regime for public service agents or the provision of information to Parliament regarding and its control over the management of public resources; that accordingly, paragraph I of Article 104 falls outwith the scope of supplementary laws on finance as specified under the basic law of 1 August 2001; that it was adopted according to a procedure which was unconstitutional;

127. Considering secondly that paragraph II of Article 104 amends Article 200-quater A of the General Tax Code in order to draw the consequences of the new provisions provided for under paragraph I; that accordingly, the provisions of paragraph II of Article 104, which cannot be separated from paragraph I, have no place in a law on finances;

128. Considering that Article 104 must accordingly be ruled unconstitutional;

ARTICLE 14:

129. Considering that, way way of exemption from Article 641 of the General Tax Code which set at six months the deadline for giving notice of succession, Article 641-bis of the Code provides that, with regard to declarations of succession relating to properties or real estate rights located in Corsica, the time limit shall be twenty four months, provided that the succession procedure was initiated prior to 31 December 2012; that subparagraph 1 of Article 14 of the law referred provides for the withdrawal of this regime of exemptions over five years;

130. Considering that Article 750-bis A of the General Tax Code provides, with respect to properties located in Corsica, for an automatic exemption from duty of 2.50% on the division of estates and the auctions of inherited properties for estates created between 1 January 1986 and 31 December 2014; that subparagraph 2 of Article 14 of the law referred provides for the expiry of this regime of exemptions over three years;

131. Considering that Article 1135 of the Code exempts from any levy for the benefit of the Treasury notarised proxies and attestations following death executed with a view to settling a jointly owned estate including real estate assets located in Corsica drawn up prior to 31 December 2014; that subparagraph 3 of Article 14 of the law referred provides for the expiry of this regime of exemptions over three years;

132. Considering that Article 1135-bis of the Code provides for the gradual termination of the regime of exemptions relating to transfer duties following death for properties and real estate rights located in Corsica between 31 December 2013 and 1 January 2018; that subparagraph 4 of Article 14 of the law referred provides for the expiry of this regime of exemptions over five years;

133. Considering that the maintenance of the exceptional tax regime applicable to successions involving properties located in the departments of Corsica has the effect that, without any legitimate reason, the transfer of these properties may be exempted from payment of transfer duties; that the renewed extension of this regime of exemptions violates the principle of equality before the law and in relation to public charges; that, accordingly, Article 14 must be ruled unconstitutional;

PARAGRAPH I OF ARTICLE 16:

134. Considering that paragraph I of Article 16 amends Article 232 of the General Tax Code with regard to the tax on vacant properties; that subparagraph 1 amends the first phrase of the first subparagraph of this Article on the definition of the urban areas within which this tax may be imposed; that it relaxes the criteria applicable to the imposition of this tax and extends its scope to municipalities falling within a continuous urbanisation area containing between one hundred and fifty thousand inhabitants and two hundred thousand inhabitants; that subparagraph 2 reduces from two years to one year the period of vacancy following which the tax will be due; that subparagraph 3 adjusts the tariff and lays down the rate of this tax, setting it at 12.5% of the rental value during the first year of taxation and 25% starting from the second; that subparagraph 4 extends from thirty days to ninety consecutive days per year the period beyond which a property will be deemed to be vacant;

135. Considering that the objective of the taxation established by the provisions of Article 232 of the General Tax Code is to encourage persons liable to pay this tax to rent out properties which are fit for rental; that it follows from the constitutional principles of equality before the law and in relation to public charges that the difference in tax treatment established by this Article for individuals liable to pay this tax will only be constitutional if the criteria establishing liability chosen are directly related to the objective pursued; that accordingly the said taxation may only apply to properties which are inhabitable and vacant and provided that it is vacant solely at the wishes of the owner;

136. Considering in the first place that properties which could only be rendered inhabitable following significant work, the cost of which would necessarily fall to the owner, cannot be subject to this tax;

137. Considering secondly that furnished properties allocated for housing, which are as such subject to the housing tax pursuant to subparagraph 1 of paragraph I of Article 1407 of the General Tax Code cannot be deemed to be vacant;

138. Considering thirdly that properties which are vacant on grounds other than the intention of the landlord which hinder their long-term occupation, either for consideration or for not charge, under normal living conditions or which prevent their occupation for consideration under normal conditions of remuneration for the landlord cannot be subject to this tax; that accordingly, properties which are shortly due to be removed or which will be affected by work relating to urban planning projects, refurbishment or demolition, or properties which have been offered for rental or sale at market prices and cannot find a tenant or buyer must in particular be exempted;

139. Considering that, subject to the reservations set forth in recitals 136 to 138, the provisions of paragraph I of Article 16 are constitutional;

THE PLACE OF OTHER PROVISIONS IN THE LAW ON FINANCES:

140. Considering that Article 44 amends the tasks allocated to the Agency for the Management and Recovery of Seized and Confiscated Assets;

141. Considering that Article 95 introduces a new Article L. 4424-33-1 into the General Code of Local Authorities on the transfer of powers relating to the production and multiplication of forest plants to the territorial collectivity of Corsica;

142. Considering that these provisions do not relate to the resources, expenditure, treasury, borrowing, debt, guarantees or accounting of the State; that they do not concern taxation of any nature imposed on legal persons other than the State; that they do not have the objective of allocating provisions to local government bodies or approving financial conventions; that they do not relate to the pecuniary liability regime for public service agents or the provision of information to and control by Parliament over the management of public resources; that accordingly, Articles 44 and 95 fall outwith the scope of a law on finances as specified under the basic law of 1 August 2001; that they were adopted according to a procedure which was unconstitutional; that they must be ruled unconstitutional;

143. Considering that there are no grounds for the Constitutional Council to raise any other question of compatibility with the Constitution ex officio,

HELD:

Article 1. – The following provisions of the Law on finances for 2013 are ruled unconstitutional:

– Article 8;

– in Article 9, letters e and h of subparagraph 5 of letter E of paragraph I, and paragraph IV;

– in Article 11, letter b of subparagraph 1 of letter A of paragraph I and letter D of paragraph II;

– Article 12;

– in paragraph I of Article 13, letter C and subparagraphs three to sixteen of letter F, along with the phrase: ", including those referred to in subparagraph 5 of paragraph II," contained in subparagraph seventeen;

– Articles 14, 15 and 44;

– in the fourth subparagraph of Article 73, the phrase: "and of an amount equal to 4 % of the taxable income used as a basis for calculating the tax on earnings under the conditions set forth in paragraph I of Article 197";

– Articles 95 and 104.

Article 2. – Articles 3, 4, 6, 10, 22, 23, 24 and 25 of the same Law and the remainder of Articles 9, 11, 13 and 73 thereof are constitutional.

Article 3. – Subject to the reservations specified under recitals 136 to 138, paragraph I of Article 16 of the Law is constitutional.

Article 4. – For the purpose of coordination following the repeal of paragraph IV of Article 9 of the Law, paragraph VI of that Article is reformulated as follows: "With the exception of subparagraph 2 of letter G, subparagraph 2 of letter H insofar as it provides for the repeal of subparagraph 5 of paragraph 3 of Article 158 of the General Tax Code, letter M and subparagraph 1 of letter N of paragraph I and letter A of paragraph III which apply to income earned after 1 January 2012, paragraphs I, II and III shall apply to income earned after 1 January 2013".

Article 5. – The following provisions of Article L. 137-11-1 of the Social Security Code are unconstitutional:

– subparagraphs five and nine;

– in subparagraphs four and eight, the phrase: "and lower than or equal to 24,000 Euros per month".

Article 6. – This decision shall be published in the Journal Officiel of the French Republic.

Deliberated by the Constitutional Council in its session of 28 December 2012, sat on by: Mr Jean-Louis DEBRÉ, President, Mr Jacques BARROT, Mrs Claire BAZY MALAURIE, Mr. Guy CANIVET, Mr. Michel CHARASSE, Mr. Renaud DENOIX de SAINT MARC, Mrs Jacqueline de GUILLENCHMIDT, Mr. Hubert HAENEL, and Mr. Pierre STEINMETZ.

Announced on 29 December 2012.