White year, social VAT, tax niches … What are the government’s tracks to save 40 billion euros in the 2026 budget?

A budget sketch before summer. This is the promise that François Bayrou, who is, is preparing to unveil in mid-July the major orientations of the 2026 budget, before his examination in the fall in Parliament. The Prime Minister, devoid of majority and confronted with a drift in public finances, intends to find 40 billion euros in savings in order to bring the deficit of France to 4.6% of the gross domestic product (GDP) in 2026. To do this, François Bayrou and his government want to cut in public spending rather than to increase taxation. Franceinfo summarizes the main avenues of the government, while consultations with parliamentary groups continue on Friday July 4 at the Ministry of Economy and Finance.

Freeze public spending for a year

The concept of a “white year” appears on fairly simple paper: it consists in maintaining public spending 2026 at their level of 2025, without taking into account the inflation of 1.4% in 2026 anticipated per The Banque de France. The method consists in increasing the credits of ministries and local communities or social benefits (retirement pensions, family allowances, minimum social, APL …). This idea has the favors of the right and part of the macronists, but the left and the national rally oppose it.

Freezing public spending without taking into account the price increase would therefore amount to saving money, but this frost would not apply to all expenses. The Minister of Public Accounts, Amélie de Montchalin, who said he was favorable on South radio has “A break” For certain expenses in 2026, mentioned “incompressible expenses” Before the Senate Finance Committeemid-June, citing the French contribution to the EU budget or the planned increase in the defense budget. It is also impossible to touch the interests to pay on public debt.

If the white year was limited to a freezing of retirement pensions, social benefits and the income tax scale, the State could save 5.7 billion euros, according to The Institute of Public PolicyOf the 40 billion sought.

Increase the rate of VAT

Emmanuel Macron and François Bayrou spoke of the idea of ​​”social VAT”, the Prime Minister arguing in particular that France has “A problem of financing (son) social model “. This track would not be a new tax but would consist in increasing the value added tax (VAT), a tax on goods and services paid by all consumers, in order to compensate for a drop in employer contributions and possibly salary taken from the pay sheets. It would aim to finance social security differently, the operation of which is mainly ensured by contributions, in order to make up for its deficit which reached 15.3 billion euros in 2024.

Defenders of the measure, including employers, see it as an immediate resource and a high -performance tax. According to a document from the High Council for the financing of social protection cited by The world (New window)To one point one point the four current VAT rates (2.1%, 5.5%, 10%, 20%) could earn 13 billion euros per year to the State. But the left and the unions are concerned about “anti -social” VAT which would disadvantage the most precarious. This measure would indeed weigh more on households with the most modest incomes because they devote a greater share of their expenses to consumption, as explained An INSEE study (new window) published in 2021.

Remove the tax reduction in retirees

The end of the tax reduction of 10% of the revenues enjoyed the retirees is also among the avenues of the government. The abolition of this deduction, which also applies to alimony and disability pensions, also capped at 4,399 euros per household, would receive all taxable retirees, or 14.96 million households, According to the annex of the 2025 finance bill. And especially the wealthy households: According to the French Observatory for Economic Conditions (OFCE), the 5% easiest households would see their taxation increase by 850 euros per year on average.

The end of this abatement introduced in 1978 would also make households mechanically enter the second tax bracket (from 11,498 euros to 29,315 euros), from which a person is 11%taxable. Remove this reduction could bring about 5 billion euros in additional revenue for the State, according to a report by the Court of Auditors (Pdf). But the measurement is very unpopular on the left as on the right, and even within the central block, where some oppose it.

Reduce the number of officials

The Minister of Public Accounts, Amélie de Montchalin, also said he wanted “Review the trend” upwards in the public service. His colleague at the Economy, Eric Lombard, also wishes to engage the “Decrease in the number of civil servants”. “We will ask, ministry by ministry, to review the recruitment needs on the one hand and employee revaluations on the other”had explained Amélie de Montchalin in early June. This could go through the non-replacement of retirements.

No lowering objective has been announced by the government, while France has 5.7 million public officials, or almost one in five employment in France, According to the Ministry of Public Service. Missioned in October 2024 by former Prime Minister Gabriel Attal, the Court of Auditors had suggested to gradually eliminate 100,000 jobs in local communities on the 2 million public officials working there, to achieve more than 4 billion savings per year from 2030.

The government is also reflecting on the merger or abolition of a third of the agencies and operators of the State, without affecting universities, in order to achieve 2 to 3 billion euros in savings by 2027. The Agency for the Ecological Transition (ADEME), Public Health France or the French Research Institute for the Operation of the Sea (Ifremer) could be affected, according to information from Public Senate. During a Hearing in the Senate In mid-May, Amélie de Montchalin had also suggested that the National Institute of Consumer Affairs (inc), which publishes the magazine 60 million consumerscould for example disappear.

Put an end to certain tax niches

The Minister of Public Accounts also wants to tackle the tax niches that she deems “Useless” Among the 467 existing devices. “There are 85 billion (euros) of tax niches. If you have 10% less niches, that makes eight billion “She said in April. If the “Personal services, who benefit many families, many elderly people”or the “Childcare” will not be affected, devices that benefit very few taxpayers may be deleted.

According to An annex to the 2025 finance bill65 of the 470 tax niches “are being extinction”. AND “15 expenses alone represent more than 50% of the total cost of tax expenditure”. The most expensive measures are the research tax credit, which allows companies to finance their research, development and innovation activities and whose amount amounts to 7.7 billion euros, followed by personal services (6.86 billion euros) and the tax allowance of retirees (4.96 billion euros).