PARIS (Reuters) – The French government will present its 2025 budget on Tuesday with plans to raise taxes and cut spending worth 60 billion euros to address a rapidly growing deficit.
Prime Minister Michel Barnier’s new government is under increasing pressure from financial markets and France’s European Union partners to take action after tax revenues this year fell below expectations and spending exceeded expectations.
However, budget pressure, equivalent to two points of national output, must be carefully calibrated to appease opposition parties, which can not only object to the budget law, but can also join together and bring down the government through a motion of no confidence.
In the absence of a majority, Barnier and his allies in President Emmanuel Macron’s camp will have no choice but to accept many concessions to pass the budget law, which is unlikely to arrive before mid-to-late December.
The far-right National Rally, whose tacit support Barnier needs to survive a potential no-confidence motion, helped block a government proposal to postpone pension increases for six months to save €4 billion.
(Translated by Laura Contimori, Edited by Sabina Susi)
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