June 30, 2024
Spending promises are likely to strain France’s public finances
France’s public finances are likely to suffer whichever bloc wins the snap election, according to AFP.
The agency has summarized the spending promises made by each competing bloc, which it says lack detail and often ignore mathematical facts.
far-right national assembly
If the National Rally wins, it wants to cut value-added tax (VAT) on energy sales, and partly finance the move, which it plans to start as early as July, by contributing a smaller €2 billion to the EU budget, although the bloc’s 2021-2027 budget has already been voted on.
The savings will in any case not make up for the loss in public revenue, which the union says will mean a €7 billion drop for the public coffers for the rest of this year and €12 billion in a full year.
However, the party also wants to impose a tax on exceptional profits from energy producers and force shipowners to pay regular corporate tax instead of the current tonnage tax.
Other expensive future plans include linking pensions to inflation, lowering the retirement age to 60 for people who started working at age 20 or earlier, exempting some workers under 30 from income tax, and raising the wages of teachers and nurses.
The RN will also do away with the 2023 retirement age increase to 64 from 62, replacing it with a more progressive system that has not yet been decided.
A 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 could finance this by imposing a tax on super-profits and reimposing a wealth tax on financial assets, each move that 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% with subsidies for small businesses that cannot handle the increase.
Other planned costly measures include hiring more teachers and healthcare workers and providing subsidies for home isolation, which the bloc wants to finance by closing tax loopholes, making income tax more progressive and allowing families to inherit a maximum of 12 million euros.
The NFP will also cancel the increase in the retirement age for 2023 and wants to eventually lower it to 60 years.
Unlike the Royal Army, it does not plan to cut the budget deficit in line with France’s commitments to its European Union partners.
And rejects the financial rules of the European Union.
“Together” centrist alliance
Macron’s party has said it is committed to cutting the budget deficit to the European Union’s ceiling of 3% of GDP by 2027, but whether that can be achieved 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 higher inflation.
In addition, it says it will raise public sector wages, without indicating any amount.
The party says it will not introduce any broad tax increases and will increase the amount parents can gift to their children tax-free.
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