With a right-wing majority, the Senate passed the “revenue” section of the 2023 budget draft in the first reading this Thursday. The vote was won by 216 votes to 91. Left voted against.
Senators immediately resolved the “expenses” part of the financial bill and will vote on the entire text on December 6.
What are the government’s ambitions with this budget?
The course set by the government for this first budget of Emmanuel Macron’s second five-year term is to keep the public deficit at 5% of GDP, capping it at 15%, despite measures such as a €45bn “tariff shield”. increasing regulated gas and electricity prices, increasing teachers, or creating more than 10,000 civil servant positions, including 3,000 police and gendarmerie. According to Minister Bruno Le Maire, the government’s priority is to “protect households and protect businesses from the consequences of inflation”.
On Monday, the IMF called on France to start cleaning up its finances next year, with the goal of reducing the deficit to 0.4% of GDP by 2030. In “very good news” for the government, the IMF still expects growth of 0.7% next year. France. However, the level of public debt is a serious concern for the right (around 113% at the end of June 2022).
The text examined in the Senate’s hemisphere for a week presents the peculiarity of the introduction of Article 49.3 of the Constitution in the Milli Majlis. And there is a risk that it will happen again after returning to the parliament. A prospect frowned upon by senators on all sides, but which did not stop them from debating at length to defend their position, knowing they would surely be swept away in the final text.
“Print your brand for the benefit of communities”
The senatorial majority of the “Chamber of Territories” took its line: in the words of the main speaker LR Jean-Francois Husson, “print your mark for the benefit of the communities”. A strong signal to the mayors who gathered at the congress in Paris at the same time. But it’s not always an easy balancing act to get right, which is also about maintaining the economy and business. This tension was particularly noticeable in the burning issue of Ile-de-France transport. The Senate finally resisted the call for help from Ile-de-France Mobilités (IDFM) LR president Valérie Pécresse (LR) who called for an increase in the mobility charge, i.e. employers’ contribution to the financing of transport.
Leftists and centrists beat the LR group on the planned abolition of the CVAE, a domestic production tax. To the anger of the government, this reform was rejected. For centrist Sylvie Vermeillet, the goal is “not only to protect the financial autonomy of local authorities, but also (…) to protect public resources”. To reassure companies, Public Accounts Minister Gabriel Attal very quickly announced that the CVAE would indeed be repealed. At the end of the day, the income of the State is 4 billion less.
The centrist component of the senatorial majority, like the leftists, could not tax the exceptional profits of large companies. “To find money, you prefer to tax the unemployed rather than super profits,” Socialist Rémi Féraud said in a government address.
Strengthened “safety net”
Senators have simplified and expanded the government’s proposed “safety net” to offset rising community energy costs. They also voted to increase the general operating grant (DGF) for inflation. “The French are turning to their mayors, who have the means to act,” noted environmentalist Daniel Breuiller.
Among other measures, the government’s opinion was voted against: reducing the VAT rate on public transport and the equestrian sector, or even reforming the tax on real estate capital gains.