France's finance minister has promised that upcoming tax hikes required to bring the country's finances back on track will be specifically targeted at high-income groups and will be temporary.
Antoine Armand's announcement on RTL radio comes a day after French Prime Minister Michel Barnier pledged to tackle "colossal" debt through a combination of spending cuts and new taxes.
The government is seeking to improve the country’s financial situation by an estimated 40 billion euros next year, with the aim of reducing the public sector deficit from more than 6 percent of gross domestic product (GDP) to 5 percent.
"Once we have managed to cut spending significantly, an exceptional and temporary effort will be required from those with extremely high incomes," Armand said Wednesday.
He assured that low- and middle-income earners would be spared from the additional fiscal burden.
"Income tax brackets for those who go to work every day will not change," he said.
French PM vows more taxes and spending cuts to reduce 'colossal' debt
'Sword of Damocles'
This approach has raised questions about how the government will balance the need for increased revenue with the potential impact on the economy.
Analysts suggest that while targeting high-income earners might generate the necessary funds, it could also provoke resistance from those affected.
During his first major policy speech to parliament on Tuesday, Barnier described France's current financial landscape as a "true sword of Damocles" that hangs over every French citizen.
He said the government aims to meet the European Union's deficit limit of 3 percent of GDP by 2029, two years later than previously planned.
"We need to act now to secure a sustainable financial future for our country," Barnier said. "Our debts exceed 3.2 trillion euros, and this is a situation we cannot ignore."
The proposed tax increases will apply to "large and very large companies".
Despite the government's efforts to shield lower-income groups, public sentiment remains cautious. Some economists argue that the reliance on tax increases, particularly for high earners, may deter investment and slow economic growth.
The government is expected to submit its 2025 budget plan to parliament next week, outlining specific measures and the expected impact on various income groups.
