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France's deficit is spiraling out of government control, undermining President Macron's credibility as an economic reformer.
According to the statistics office, the gap between revenue and spending widened to 5.5% of GDP last year from 4.8% in 2022. Tax revenue growth slowed sharply as the French economy "stagnant" while spending growth slowed. easy.
The growing budget deficit is a blow to Macron, who since taking office in 2017 has played on his reputation for fiscal discipline in contrast to previous years.
In his first mandate, he improved the deficit or harmonized it with the objective in four cases, while in one he encountered a problem due to the pandemic. A shift to tax increases, which the government has opposed, or more drastic spending cuts, would be dangerous.
Emmanuel Macron's party is already trailing far-right national rally Marine Le Pen by around 10% in opinion polls ahead of European elections.
In addition, Macron has promised to cut taxes on low wages in 2025. The finance ministry already announced 10 billion euros in savings in February to get back on track to meet the deficit target of 4.4 percent of GDP— of this year, reports abcnews.al.
At least another €20 billion will also be required from the 2025 budget.
Bruno Le Mair, the finance minister, aims to bring the deficit below 3% of the EU in three years, when Macron's presidency ends.
Some of the French president's allies have called on him to abandon the no-tax-raise philosophy that has helped spur foreign investment in France. Le Maire said she was open to tougher taxes on energy company windfalls, but reiterated that the government opposes any tax increase.
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