France is currently struggling with “one of the largest” budget deficits in modern history, its newly appointed economy minister said on Tuesday, confirming that new taxes on the wealthy and big corporations are on the table to help get its finances back on track.
Antoine Armand added that he would talk to economic actors, including unions and employers’ organizations, to try to reduce government spending, which is expected to amount to 5.6 percent or more of national output this year, almost double the European Union limit.
“Apart from one or two one-off crisis years in the last 50 years, we have one of the biggest deficits in our history,” Armand told broadcaster France Inter.
“At that level the situation is serious.”
The new government led by conservative Prime Minister Michel Barnier faces a parliamentary challenge in the coming months.
Ministers must try to push a 2025 budget, with measures to restore government finances, through the lower house of the National Assembly, which is roughly divided into three following snap elections in July.
Barnier can count on the support of conservatives and the much-reduced camp of President Emmanuel Macron, but the left-wing alliance of the NFP and the far-right Rassemblement National (RN) could overthrow the government at any time through a confidence vote if they join forces.
In an interview on Sunday, the prime minister raised “targeted” tax increases on “rich people or a few big companies” as part of a plan to get the ship back on course.
Patrick Martin, chairman of the employers’ organisation Medef, has said he is “open to discussion” about tax increases.
“My job is to make sure that any taxes do not hamper our growth and employment,” Armand said.
“We will not impose a higher tax burden on working people, people who are in the middle class,” he added.
In contrast, Armand suggested that people with large assets, who sometimes do not pay much tax, could contribute more in our current situation.
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