Pierre Lellouche sounds alarm : Will a €40 billion tax break France’s economy ?

As the debate over budgetary revenues rages on and tensions mount, a new tax of €40 billion could further shake the already fragile economy of France. During an intervention this Sunday, October 27, Pierre Lellouche, former minister, sounded the alarm: “the French economy will undergo a shock that will stop it at the worst possible moment.” This statement, heavy with consequences, occurs in a context where economic recovery is more necessary than ever, but where maneuvering space is shrinking day by day.

The fiscal shock of €40 billion voted by the National Assembly

Last Sunday, Pierre Lellouche, former minister and recognized expert on economic issues, expressed his concern about the new budgetary decisions of the National Assembly. Thus, in a strong statement, he warned that “the French economy will undergo a shock that will stop it at the worst possible moment,” referring to the €40 billion in additional taxes voted on in just a few days. These new levies add to the €30 billion already announced by Michel Barnier in the 2025 budget, thus increasing the fiscal pressure on households and businesses. For Lellouche, this rise is not only “worrisome,” but it could also stifle an economy that is already struggling to catch its breath after months of crisis.

The immediate impact of these decisions is palpable: the French are likely to further restrict their consumption, according to Lellouche. Indeed, “the person who wanted to buy a sofa, they will end up giving up, they also give up going to the restaurant,” he declared during his appearance on the Grand Rendez-Vous show on CNEWS. This decline in consumption, which is yet a key engine of growth, could provoke a domino effect across many sectors. Already weakened by inflation and a tense economic situation, French companies will have to face a significant reduction in demand.

An economy on the verge of stagnation ?

The new taxes imposed by the National Assembly are not just about the short term. With the addition of the additional taxes, the government risks stalling the long-term investments of businesses, which may choose to delay or cancel important projects in light of this tax increase. “This is not the moment to stifle the economy,” warns Pierre Lellouche, emphasizing that France is already behind on its recovery targets. The drop in domestic consumption, coupled with increased tax pressure, could have disastrous consequences for the country’s competitiveness.

Beyond the immediate impact on consumption and businesses, these new measures also risk destabilizing employment. Indeed, an economic slowdown could lead to job cuts, particularly in sectors most affected by declining demand, such as retail and hospitality. The prospects for 2025 are therefore particularly bleak, as the country is already struggling to contain a high unemployment rate. “If households and businesses stop spending, the economy can come to a complete halt,” warns Lellouche.

The fiscal decisions taken by the National Assembly, although necessary to fill budget deficits, could lead to a deep slowdown of the French economy. If supportive measures are not put in place quickly, France could see its economy stagnate or even regress, with serious social and economic consequences. The budget debates will resume on November 5, but the initial reactions already suggest significant opposition to these tax increases. We hope that cryptocurrencies, particularly Bitcoin, will not be subject to taxation.