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French Senate Passes Overhauled 2026 Budget, Setting Up High-Stakes CMP Talks

A right-led rewrite trims new levies, lifting the projected deficit to 5.3% of GDP.

Overview

  • Senators approved the state budget bill in first reading by 187–109, sending the right‑remade text to a joint committee on Friday to seek a compromise.
  • The Senate scrapped the surtax on large companies and sharply pared back the proposed tax on patrimonial holdings, weakening planned revenues.
  • The deficit outlook now stands at roughly 5.3% of GDP, according to Public Accounts Minister David Amiel, above the government’s under‑5% objective.
  • The Assembly narrowly backed the social‑security budget after concessions that shift about €4.5 billion from the state, adding pressure on the overall fiscal balance.
  • The government still targets a budget before December 31 as calls to use article 49.3 grow, though the Prime Minister has pledged to avoid it and could resort to a temporary special law if CMP talks fail.