France certainly did not expect Michel Barnier to play the stingy role in chief. And yet, with scissors in budgets and tax increases, the former European negotiator is working to cut all possible expenses. Result ? Growls are heard from all sides. The drastic cuts, particularly in national education and pensions, have made the opposition rise as one, denouncing this “social war budget”.
Budget 2025: A budget cut that stirs up a storm
Michel Barnier, whose appointment caused French banks to jump in early September, hit hard with his Finance Bill (PLF) for 2025. With a target of 60 billion euros in savingsthe budget is hailed by the government as an inevitable austerity measure, but it is perceived by the oppositions as a real “butcher’s shop”.
Jean-Luc Mélenchonleader of the Insoumis, denounces the elimination of 4,000 positions in National Education like a “ calamity “. Aurélien the Rooster goes even further by evoking a “ social war budget “. For Éric Coquerel, president of the finance committee, the situation is gloomy for the middle classes and the most deprived.
The opposition protests, but the government remains inflexible, justifying these cuts by the need to curb a growing debt – France being in the world’s top 10 indebted countries. Among the key measures, we find a review of the retirement calendaras well asa new tax on the wealthiest households. What makes people cringe even more is the perceived unequal distribution of this effort.
Some deputies, notably Jean-Philippe Tanguy of the National Rally, cry injustice, pointing out a disproportionate contribution from the working classes.
THE key points of the 2025 budget :
- Elimination of 4,000 positions in National Education;
- Revaluation of pensions postponed by six months;
- New taxes for wealthy households (65,000 households targeted);
- Exceptional contribution from companies with high profits;
- New taxes on plane tickets.
Public finance: Barnier imposes his law on taxes and businesses
Under the pressure of a colossal debt – the only critical one being €3,228 billion, Michel Barnier did not hesitate to bring out the heavy artillery to replenish the state coffers. Between new taxes for the wealthiest households and additional taxes for large businesses, theThe 2025 Finance Bill particularly targets those who have the most. But what does it mean to be rich in France in 2024?
At the top of the list, an exceptional contribution is requested from 65,000 tax households whose income exceeds 250,000 euros for a single person and 500,000 euros for a couple. This levy, temporary over three years, will raise several billions to stabilize the country's financial situation.
But it’s not just households that are toasting. Companies with a turnover of more than 1 billion euros will also be involved.. The government hopes draw 12 billion euros over two years by taxing these companies at 20.6% to 41.2% of their corporate tax.
At the same time, tax adjustments, such as a revision of the income tax scale, are supposed to protect low-income households from further tax increases, although many fear that this will not be enough to offset the overall impacts of the budget.
On the parliamentary side, the battle promises to be tough. If the majority remains ready to defend this budget by arguing that it is essential to stabilize France's economic trajectory, the opposition has not said its last word. The use of the famous article 49.3 could well be the government's trump card to force the adoption of this burning text.
Thus, to avoid a major crisis, the objective remains clear: 150 billion savings by the end of the financial year. Otherwise, the crisis seems inevitable in France. In other words, the nightmare has only just begun.
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