France drops deficit reduction target for 2027 budget, rules out tax hikes

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PARIS — France’s Economy Minister Roland Lescure said on Thursday a “stable public deficit” was the goal for next year’s budget.

The government was initially aiming to bring France’s 2027 deficit below 5 percent of GDP, the current estimate for this year, in its upcoming budget bill, with a target reportedly set at 4.9 percent.

But grim economic forecasts and a fractured parliament are making its deficit reduction trajectory more and more elusive, including a government commitment to bring back the deficit under 3 percent by 2029 to abide by EU rules.

Lescure was speaking at a high-profile gathering of business leaders organized by French business lobby Medef, where he said his government was working on providing “stability” in the upcoming months, with no tax increases and an effort to further tighten the administration’s belt.

He also confirmed that the government was looking into a partial pension freeze in an effort to keep the deficit under control.

The government is facing a new harrowing budget season, with a deadlock parliament and opposition parties unlikely to cooperate as the 2027 presidential election campaign swings into full gear.

Leftist candidate Jean-Luc Mélenchon has already said his party was readying for a no-confidence vote over the budget bill.