The Politics of Tax Exemptions for Home Services: Beyond Sociodemographic Explanations

Tuesday, June 25, 2013
2.04 (Binnengasthuis)
Clémence Ledoux , Political science, university of Nantes
Virginie Florence Guiraudon , Centre national de la recherche scientifique (CNRS)
Recent literature has described the development of special tax deductions and exceptions as a "hidden form" of welfare provisions (Howard 1997, Hacker 2002, Gilbert 2010) or as the sign of the transition towards a "regulatory state" (Nullmeier 2002). However, the mechanisms leading to these changes and their consequences on the “welfare-mix” have been neglected. Drawing on the French experience, this paper explains the political conditions that made the expansion of these policies possible and their downsizing difficult.

While early forms of socio-fiscal exemptions for domestic services were introduced in France in 1948, they were largely extended in the early 1980s and have continued their progression ever since. Described by civil servants as a way to reduce unemployment, they represented more than six billion euros in 2009.

Far from been a natural translation of social transformations, these policies were the result of political mobilizations. Their adoption did not attract the attention of the media and their impact was not really evaluated until the early 2000s. Very costly, they tend to benefit middle-class households and promote the development of home-based direct employment relations and the creation of commercial firms providing domestic work. They are a typical example of “client politics” (Wilson 1980) -with diffuse costs and concentrated benefits- and, therefore, it has been difficult to remove them, unless their withdrawal is embedded within a larger discourse of political reform. We will conclude with an examination of the way in which the crisis can affect them.