Michel Barnier on TF1 and France 2 news contradicts Macron on post-censorship and points to tax increases

POLITICS – For once, the Prime Minister gave his interview to the news of TF1 and France 2 from Matignon this Tuesday, December 3. Michel Barnier, who should leave in the coming days unless there is a surprise “Léon Blum’s office”, as he himself described it, notably warned about the consequences of the adoption of the motion of censure which he will face on Wednesday. A much more alarmist speech than that of Emmanuel Macron a few hours earlier.

“The situation is very difficult economically, socially, budgetarily, financially, very difficult. I've known it from the start. (…) What I am sure of is that if the motion of censure passes, everything will be more difficult and everything will be more serious”alerted the head of government whose social security financing project (PLFSS) does not convince the oppositions.

Michel Barnier's alarmist speech has been running in a loop for several days and the inevitability of 49-3, finally triggered on Monday to pass this first part of the 2025 budget. Marine Le Pen herself warned of the risk of ” shutdown » American style. Which does not prevent her from promising that she and her troops will vote for the motion tabled by the left, considering Michel Barnier's concessions insufficient.

Interest rates and taxes

From Riyadh in Saudi Arabia, Emmanuel Macron nevertheless calmed things down this Tuesday. “We shouldn’t scare people with these things, we have a strong economy”replied the President of the Republic. “ France is a rich, solid country, which has made many reforms and which is maintaining them, which has stable institutions, a stable Constitution”he asserted.

If the Prime Minister declared on TF1 and France 2 that the president “is right to say that we must not catastrophize”he also recalled that the financial markets were not optimistic. “I see the spreads, the rate differences at which we borrow in the name of France and which the French will pay. We're almost above Greece, and it's moving away. (…) There will be emergency measures for a few months. But the impact of this political instability will be seen in interest rates”alerted Michel Barnier.

The French could also feel the impact of this crisis in terms of taxes, he insisted, affirming that « 18 millions » of French « will see their income tax increase » if the 2025 budget is not adopted.

Le Figaro effectively explained the impact on the French wallet in an article published on Monday. If the 2025 budget is not adopted on time, it is still possible to go through a ” special law authorizing it to continue to collect existing taxes”, according to article 45 of the organic law relating to finance laws (LOLF). Concretely, this means that the 2024 budget would be extended for one year.

But this also means that the income tax scale, which was to be indexed to inflation at 2% according to the text proposed by Michel Barnier's government, will ultimately not be revised. Tax brackets will remain the same while incomes will increase. Result emphasize Le Figaro and Michel Barnier: nearly 18 million households will see their taxes increase. The Minister of Public Accounts Laurent Saint-Martin also indicated at the end of November in The Parisian that around 380,000 households would become taxable.

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