France's 2025 Budget Presentation
PARIS (Reuters) – France's government presented on Thursday its 2025 budget aimed at plugging a gaping hole in public finances with €60 billion ($65.68 billion) worth of tax hikes and spending cuts.
Main Measures
Spending Cuts
- The government will cut 2,200 jobs, particularly among teachers due to a declining student population.
- Foreign aid will be reduced by €1.3 billion.
- Subsidies for apprentices and other jobs will decrease by €2.1 billion.
- Green subsidies for insulation and electric cars cut by €1.9 billion.
- Planned pension increases due to inflation set for January 1 will be postponed by six months, saving €3.6 billion.
Tax Hikes
- Big Companies: Those with revenues exceeding €1 billion will pay an additional tax expected to raise €8 billion, affecting 440 companies.
- Wealthy Individuals: Households earning over €250,000 will face a temporary income tax increase, with a new minimum tax of 20% to close loopholes, raising €2 billion annually.
- Air Transport: A tax on airplane tickets and private jets will be increased, details to be finalized during parliamentary debates.
- Utilities: Nationalised power utility EDF will increase dividends to the state by €2 billion. A tax on electricity will be raised back to pre-war levels in Ukraine, expected to generate €3 billion, while power bills for consumers are predicted to drop by around 9% due to decreased wholesale prices.
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