France eyes €32B in spending cuts and €21B in tax hikes

PARIS — The French government is planning to cut public spending in 2025 by €32 billion and to increase taxes by €21 billion, Budget Minister Amélie de Montchalin said on Wednesday.

“It’s the biggest spending reduction effort in the last 25 years,” she said in an interview with French broadcaster TF1.

De Montchalin said the government was planning to cut the budget of all public agencies by 5 percent and to merge some of them to reduce costs.

POLITICO first reported on Tuesday that the government was eyeing a total budget effort of €53 billion in 2025.

France went into the new year without a proper budget after former Prime Minister Michel Barnier’s government was toppled over its spending plans, but lawmakers adopted some stopgap measures to avoid a U.S.-style shutdown.

On Tuesday, Prime Minister François Bayrou said he planned to bring the country’s deficit down to 5.4 percent of gross domestic product in 2025.

France’s deficit came in at 6.2 percent of GDP last year, more than twice the level permitted by European Commission rules. Brussels placed Paris under an excessive deficit procedure for overspending in 2023.

Bayrou is planning to to bring the deficit in line with the 3 percent rule required by the Commission by 2029.