General policy speech by Michel Barnier: what could the Prime Minister announce this Tuesday?

Several political leaders in France, particularly on the right and within the “macronie”, expressed on Monday September 30, 2024 their firm opposition to a possible increase in taxes on the eve of the presentation by the new Prime Minister, Michel Barnier, of his general policy statement. It will take place on Tuesday at 3 p.m. in front of the National Assembly.

The daily Le Monde reported on Sunday that an exceptional levy of eight billion euros on large groups and a tax on share buybacks were among the measures envisaged by the government to reduce public deficits. Speaking on Cnews and Europe 1, the former French head of state, Nicolas Sarkozy, estimated that an increase in taxes would weigh on employment, growth and investment.

“I want to say in the clearest way that if after seven years of tax stabilization by Mr. Macron, a right-wing Prime Minister increases taxes, I say it bluntly, that would be a mistake,” he said. he declared. “For me, it is not possible, France is the country which pays the most taxes, the country where redistribution is the greatest, the country where the amount of public expenditure is the highest and the country where the feeling of injustice is also the greatest,” he continued. “So reasoning in terms of tax increases would be an economic error,” he concluded.

Fracture within the Macronists

Former ministers do not mince their words. Gérald Darmanin, the former Minister of the Interior, who made his political comeback this weekend in Tourcoing (North), seems to share, at least in part, Nicolas Sarkozy’s point of view. “If we increase taxes, we will increase unemployment,” he warned, according to comments reported by Le Monde. “When you increase taxes, even symbolically, on the richest, back home, in the north of France, people go to Belgium,” he added.

Saturday September 28, 27 Macronist deputies signed a joint forum to oppose a possible tax increase. The signatories include, among others, Aurore Bergé, Mrie Lebec and the former president of the Renaissance group Sylvain Maillard.

Obstacles to adopting the 2025 budget

In addition to Michel Barnier’s general policy declaration scheduled for Tuesday, France must have the 2025 budget adopted in Parliament before the end of the year, without an absolute majority, and with the threat of opposition from the New Popular Front (NFP) and of the National Rally (RN).

The French public deficit is expected to be more than 6% of gross domestic product (GDP) in 2024 and Paris is already targeted by a European procedure for excessive deficits. Questioned on LCI, Sébastien Chenu, the spokesperson for the National Rally (RN), however estimated on Monday that France was not living beyond its means. According to him, there are sources of savings, “taboo expenses”, such as immigration which could allow “saving 15 billion euros per year”.

On France 2, the President of the National Assembly, Yaël Braun-Pivet, underlined Monday the need to return to a balanced budget, saying that she was first in favor of “working on expenses”. “The main effort must focus on reducing spending and not on revenue,” the general budget rapporteur, Charles de Courson, also added on Monday on Franceinfo. Former Prime Minister Elisabeth Borne, who used article 49.3 of the Constitution ten times, which allows for force to pass a budget, declared on BFMTV/RMC: “I fear that my successor will not find majority to pass the budget and perhaps he will resort to this famous article 49.3”.