France plans to borrow 310 billion euros in 2026 on the financial markets, a record amount, to finance the public deficit and refinance overdue debts, according to the program published on Tuesday, October 14, by the Agence France Trésor (AFT), responsible for managing the State’s debt.
However, this sum compared to the wealth produced by the country throughout the year should represent 10.1% of GDP in 2026, a proportion that does not change compared to 2025 and which remains lower than the maximum of 11.2% reached in 2020, the year of the health crisis. France’s borrowing rates fell slightly on Tuesday, a sign that markets perceive an easing of the political crisis.
The public deficit should be 5.4% of GDP this year. The Government’s draft budget presented this Tuesday plans to reduce this deficit to 4.7% in 2026 and 3% in 2029. To achieve this first step next year, the executive proposes an effort of 30,000 million euros, obtained mainly by strongly imitating the increase in public spending.
Blank year and tax increase.
The draft Social Security budget for 2026 provides, in particular, for a “freeze of all basic pensions” in 2026, as well as a freeze of social benefits such as family allowances. Tax increases are also expected, particularly for the wealthiest. The project plans to extend by one year, but reduce by half, the surtax on the profits of large companies introduced in 2025.
Likewise, the differential contribution to high incomes (CDHR), also imagined as temporary, will also be expanded in one year. It sets a minimum tax rate of 20% for households whose income exceeds 250,000 euros for a single person and 500,000 euros for a couple, and is added to an exceptional contribution from high incomes (CEHR). The text also provides for the establishment of a tax on asset-holding companies, sometimes used to evade taxes.
Source: BFM TV
