June 30, 2024
Spending promises likely to weigh on France’s public finances
France’s public finances are likely to suffer whichever bloc wins the snap election, according to AFP news agency.
The agency has summarized the spending promises of each competing bloc, which it says lack detail and often ignore mathematical facts.
National Rally of the Far Right
If the National Rally wins, it wants to cut VAT on energy sales, partly financing the move, which it plans to start as early as July, by contributing €2 billion less to the EU budget, although the bloc’s budget for 2021-2027 has already been voted on.
However, these savings will not make up for the loss in public revenues, which the union says means €7 billion less for public coffers for the rest of this year and €12 billion in a full year.
The party also wants to impose a tax on windfall profits from energy producers and force ship owners to pay regular corporation tax instead of the current tonnage tax.
Other costly future plans include tying pensions to inflation, lowering the retirement age to 60 for people who started working at 20 or earlier, exempting some workers under 30 from income tax, and raising the wages of teachers and nurses.
The RN will also ditch the 2023 retirement age increase to 64 from 62, replacing it with a more progressive system that has yet to be determined.
New leftist popular front
The New Popular Front coalition says it plans to increase civil service salaries by 10 percent, provide free school lunches, supplies and transportation, and increase housing subsidies by 10 percent.
It says it can finance this by imposing a tax on super profits and reintroducing a wealth tax on financial assets, each move which would raise €15 billion, according to the bloc.
The group also wants to freeze basic food and energy prices while raising the minimum wage by 14% while offering support to small businesses that cannot cope with the rise.
Other costly measures planned include hiring more teachers and healthcare workers and providing subsidies for home insulation, which the union wants to finance by closing tax loopholes, making income tax more progressive, and allowing families to inherit up to 12 million euros.
The National Labor Party also wants to scrap the 2023 increase in the retirement age, and eventually lower it to 60.
Unlike the National Front, it does not plan to cut the budget deficit in line with France’s commitments to its EU partners.
And rejects the financial rules of the European Union.
The “Together” Center Alliance.
Macron’s party has said it is committed to reducing the budget deficit to the European Union’s ceiling of 3% of gross domestic product by 2027, but the possibility of achieving this has been called into question by institutions from the national auditor to the International Monetary Fund.
The party also pledged to cut electricity bills by 15% from 2025 and link pension increases to inflation increases.
The government also says it will raise public sector wages, without indicating how much.
The party says it will not introduce any wide-ranging tax rises and will increase the amount parents can gift to their children tax-free.