Budget 2026 Debates Stall in French National Assembly, Zucman Tax Examination Delayed

The parliamentary debates over France's 2026 budget have encountered significant delays, particularly concerning the examination of the proposed "taxe Zucman" targeting wealth taxation. On October 25, discussions extended deep into the night at the National Assembly without addressing the taxation measures on high wealth. Public Accounts Minister Amélie de Montchalin announced that certain budget articles would be prioritized the following Monday, effectively postponing the debate on the Zucman tax—supported by left-wing factions—to later in the week, possibly Tuesday or Wednesday. This delay occurs amid pressure from Socialist deputies who have issued Prime Minister Sébastien Lecornu an ultimatum demanding substantial fiscal justice measures by Monday, with the threat of censure looming if their demands are not met.

Earlier sessions yielded victories for the right-wing Republicans, including the approval of a full tax exemption for overtime hours, which will cost the state approximately €1 billion. Additionally, a proposal to index income tax brackets to inflation was adopted, preventing the increase in taxable households that would have resulted from the government's planned tax freeze but at a €2 billion cost to public finances. These measures raised concerns over the rising expenditures and their impact on deficit reduction goals.

The left's attempts to reduce the personal services tax credit sparked heated exchanges, with conservative deputies accusing the government of attempting to "buy" votes. Negotiations continue as government officials indicate efforts to reach a compromise with the Socialists on wealth taxation, while budget revenue discussions remain in early stages, with a solemn vote scheduled for November 4. The Socialists have also linked their support to the suspension of pension reforms included in the social security budget, set for committee review starting Monday. Senate President Gérard Larcher suggested pension reform would be reinstated after the Assembly's vote. Notably, the atmosphere in the Assembly has been less turbulent than in previous governments, but the slow pace of debates has delayed progress on significant fiscal measures.