The National Assembly is debating, this Friday, some 20 billion additional euros placed on the table by the government in its amending budget for 2021, in order to prevent deconfinement from rhyme with collapse for certain companies and employees. This amending finance bill extends, at least until the end of August, emergency aid for companies, with an extension of 15.5 billion euros to finance their gradual exit.
More “targeted and degressive” aid
Last step of “whatever the cost”? This is what the Minister of the Economy, Bruno Le Maire, promised, who defends a “text of transition between maximum protection (…) and return to normal” with more “targeted and degressive” aid. In mid-May, the executive had already drawn 7.2 billion in credits, thanks to an advance decree. An exceptional amount. By continuing to keep the French economy on a drip, the executive is digging the public debt ratio, which would reach 117.2% of GDP at the end of the year.
Second force of the majority, the Modem worried about “the enormous deficit” of France, with approximately “220 billion” envisaged in the amending budget 2021, at 9.4% of the GDP. “We cannot afford to have a deficit like this in 2022. We are ready to work on public spending,” insists centrist Christophe Jerretie.
In Les Echos, Bruno Le Maire promised to “define a clear deleveraging strategy”, while in the opposition, the deputy LR Eric Woerth, chairman of the Finance committee, is worried about a “spending atmosphere”.
With this first amending budget for 2021 – in 2020, parliamentarians had voted four, a record – the executive is also playing caution while the economy of France, suspended on the progress of vaccination of the population, hopes avoid a 4th epidemic wave. The government has also not raised its growth forecast, expected at 5% this year. Of the additional 15.5 billion euros intended for emergency aid mechanisms, 6.4 billion are programmed for the maintenance of partial activity, 3.4 billion for the solidarity fund and 4 billion will go to the compensation for exemptions from charges. Certain sectors such as the hotel and catering industry but also tour operators, air transport or events have been severely tested by months of confinement and are emerging economically drained, with very variable prospects for recovery.
To these expenses are added 1.4 billion euros to finance several recent announcements. Including 700 million euros for the maintenance of emergency accommodation places, nearly 400 million euros for compensation for farmers, especially those affected by the frost in early April, as well as 400 million euros for the “Pass’Sport” for young people, aid to the New Caledonian community or even funding for the “Quartiers d’été” operation, intended to animate disadvantaged neighborhoods.
Some 480 amendments have been tabled on the bill. One of them deposited by the government should cringe a few teeth at a time when Emmanuel Macron is trying to green his balance sheet. This involves postponing from July 1, 2021 to January 1, 2023 the price increase for non-road diesel, used mainly in construction and public works, in order to take into account the consequences of the health crisis.
Another point of tension, an unprecedented tax gesture for donations to worship. The tax deduction on donations will go from 66% to 75% until the end of 2022, up to a limit of 554 euros. “The cults have particularly suffered” in the period “because they were not helped in the name of the separation of the churches and the State”, explained the boss of the LREM group, Christophe Castaner, to justify this modulation of the tax deduction.
The provision will be fought by the left of the hemicycle: LFI, the PS but also the Liberties and Territories group have tabled deletion amendments. For their part, the LRs will put on the table the colossal losses of La Poste due to the deficit of the universal postal service that the crisis has only increased. Right-wing elected officials will propose a significant tax exemption.
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