Budget 2025: how MPs are worsening the deficit

After 75 hours of debate that began on October 21, the National Assembly completed the discussion of the revenue part of the finance bill on the night of Friday November 8 to Saturday November 9. On the afternoon of Tuesday, November 12, the deputies will decide by a solemn vote on a text largely revised by the left.

“Thanks to the tens of billions of new revenue created, the deficit goes from 142 billion, initially planned by the government, to 85 billion and stands at 2.9% of GDP”welcomed LFI deputy Éric Coquerel, president of the finance committee.

The New Popular Front thus prides itself on having found 75 billion in new revenue, including 13.7 billion by taking from the “ultra-rich” (contribution on high incomes higher than that planned by the government, tax of 2% on the wealth of billionaires, etc.) and 58.7 billion on multinationals (tax on superprofits, increase in the global minimum tax from 15% to 23%, exceptional contribution from CAC 40 companies, tax on share buybacks toughened compared to the government project…).

“A net revenue loss of 10 billion euros”

By removing 17 billion euros in taxes (cuts in VAT and electricity taxes, extension of the zero-rate loan, etc.), the left claims to have added 58 billion euros net to government revenue. ‘State. “A tax overdose that will spare no one”, said the Minister of Public Accounts Laurent Saint-Martin at the end of the debates, after however having succeeded in having the increase in air transport taxation approved.

The general budget rapporteur Charles de Courson (Liot), however, tempers the left’s announcements. According to his calculations, the measures passed would only result in 30 billion euros in additional revenue and 20 billion euros in revenue losses, or a net revenue of 10 billion. He also notes that many of them are contrary to European law or to the jurisprudence of the Constitutional Council: ultimately, “the revenue part amended by our hemicycle would represent a net revenue loss of 10 billion euros”therefore believes the MP whose calculations are the most reliable approach currently available.

The vote for the first part of the PLF 2025 is, however, uncertain: the text, already greatly reworked by amendments from the left, was rejected in committee on Saturday October 19, with all parties other than those of the NFP opposing it. However, the discussion of the expenditure part by the Assembly, scheduled for Tuesday afternoon, is conditional on the prior vote on the revenue part.

The government will be able to rely on the Senate

In the Finance Committee, the deputies have already increased the expenditure part by 44.3 billion euros in additional credits (15.5 billion for ecology, 12 billion for territorial cohesion, 7.3 billion for education school). “Only four amendments adopted concerned a reduction in appropriations for a total of 505 million euros”regrets Charles de Courson, noting that, in the current state of discussions in committee, the deficit is worsened by 54 billion euros.

The government, which wishes to reduce the deficit to 5% of GDP in 2025 (after 6.1% in 2024), will however be able to rely on the Senate to try to reduce the bill, as the latter had already done for the 2024 budget by proposing 37 billion euros in savings, not retained by the government at the time. But the High Assembly, which begins examination of the first part of the finance bill on Wednesday November 13 and has already started working on appropriations, could have more difficulty trying to contain the expenditure of local authorities.

These debates thus show the difficulty of making budgetary savings. “Cutting out an expense is extremely difficult because it always represents euros that end up in the pockets of someone who will therefore be unhappy to see it disappear”summarized the president of the Fipeco association François Écalle, during a meeting at the beginning of November at the Court of Auditors.

“As there will always be someone unhappy, consultation is impossible to hold, continued the public finance specialist. All that remains is the policy of the plane: reducing credits by authority, for example by 0.5%, in fact obliges administration and local authorities, who know how things work, to find the corresponding production gains. »