France now has “one of the worst” public deficits in its modern history, the newly installed economy minister said on Tuesday, confirming that new taxes on the rich and big business are on the table to revive the economy.
Antoine Armand added that he would talk to economic players, including unions and bosses’ organisations, in a bid to reduce government overspending, which is expected to reach 5.6% or more of national output this year — nearly double from the border of the European Union.
“Apart from one or two extraordinary crisis years in the last 50 (years), we have one of the worst deficits in our history,” Armand told France Inter television.
“At this level, the situation is serious.”
The new government under conservative Prime Minister Michel Barnier faces a parliamentary gauntlet in the coming months.
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Ministers must try to get a 2025 budget with steps to restore public finances through the lower house of the National Assembly, roughly divided in three after July’s inconclusive snap election.
Barnier can count on the support of the conservatives and President Emmanuel Macron’s much-reduced camp, but the leftist NFP alliance and the far-right National Rally (RN) could topple the government at any time in a confidence vote if they join forces .
In an interview on Sunday, the prime minister brought up “targeted” tax increases on “wealthy people or some big companies” as part of a plan to right the ship.
Patrick Martin, head of the Medef bosses’ federation, said he was “open to discussions” about tax increases.
“My job is to make sure that any potential taxes that are going to be there don’t hinder our growth, they don’t hinder job creation,” Armand said.
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“We’re not going to put a heavier tax burden on working people, on middle class people,” he added.
Instead, “people with very large fortunes, who by the way sometimes don’t pay much tax…can they contribute more to our present situation?” Armand suggested.
Source: AFP