Emmanuel Macron backs “exceptional” but limited tax on large corporations

The day after Prime Minister Michel Barnier’s general policy speech, President Emmanuel Macron endorsed the introduction of an “exceptional” tax targeting large corporations, while insisting that it should remain “limited”.

Speaking at a forum in Berlin on Wednesday, the head of state declared that the initiative, announced by the government, was “well understood by big business”. However, he warned against the risk of overtaxation, stressing the need to strike a balance so as not to harm France’s economic attractiveness. “The solution must not be a short-term adjustment by cutting social spending or massively raising taxes, because we don’t have much fiscal room for maneuver,” Emmanuel Macron said.

Response to the deteriorating economic situation

Michel Barnier, in his general policy statement the previous day, had announced that an additional contribution would be requested from large companies with substantial profits, as well as from the wealthiest French citizens, citing the need for “tax justice”. The stated aim is to gradually reduce the country’s debt, while the public deficit could reach 6% of GDP this year, well above the 3% required by European Union criteria.

Limited fiscal room for maneuver

Emmanuel Macron also pointed out that France already leads Europe in terms of compulsory deductions, thus limiting the options for new taxes. “We don’t have much room for maneuver when it comes to taxation,” he stressed, while referring to the priority of stimulating youth employment and reducing the unemployment rate.

Europe at the heart of priorities

Aware of domestic challenges, Emmanuel Macron also expressed his willingness to focus his efforts on the European level from now on. “For me, the priority is to act at European Union level”, said the President, who wants to boost growth momentum within the bloc.

He called for a “shock simplification” of European regulations, arguing that excessive standards are holding back innovation and economic dynamism. “The European Union has immense untapped potential, and this is where we can unlock new sources of growth,” concluded Emmanuel Macron.