French Assembly Faces Tight Review of 2026 Social Security Budget Amid Senate Amendments

The French National Assembly is set for an intense examination of the 2026 Social Security budget on November 29, with the Social Affairs Committee tasked to sift through around 500 amendments in a single day. This comes after the budget text was returned by the Senate with significant changes, including the removal of the pension reform suspension. The Assembly's review is vital ahead of the second reading scheduled for December 2, aiming to produce a version capable of securing a parliamentary majority.

Negotiations are tightly focused on fiscal measures affecting social contributions on high salaries and the freezing of social benefits and pensions traditionally indexed to inflation. Socialist deputy Jérôme Guedj highlighted the critical nature of the upcoming week, noting the Social Security budget could serve as a "peace judge" influencing the broader state budget negotiations.

The government is striving to keep the Social Security deficit below €20 billion, improving on an initial estimate of €24 billion after the first reading. The Senate has introduced significant amendments, notably a proposal imposing social contributions on salary supplements above €6,000 per year for high earners.

Separately, the Senate also passed a contentious amendment to reform the Impôt sur la Fortune Immobilière (IFI), the real estate wealth tax. This amendment raises the taxable threshold from €1.3 million to €2.57 million, aimed at alleviating tax burdens exacerbated by soaring real estate prices. Centrist senator Sylvie Vermeillet, who has pushed this amendment annually since 2019, argued the measure is essential to avoid unfairly taxing households newly liable due to property value increases. Critics, including LR member Albéric de Montgolfier, contest that the IFI unfairly targets real estate including residential and industrial properties, and that increased taxation is already harming Paris’s luxury real estate market.

The complex negotiations continue as parliamentarians weigh fiscal responsibility with social equity and economic impacts. The final vote on the Social Security budget is expected on December 9.