Gabriel Zucman Opposes Diluted Wealth Tax Proposal Amid Heated 2026 Budget Debates
Gabriel Zucman criticizes a diluted version of his proposed wealth tax amid intense parliamentary debates over France's 2026 budget, highlighting concerns about tax exemptions undermining effectiveness.
- • Gabriel Zucman opposes the socialist proposal for a 'light' version of his wealth tax, warning exemptions will undermine effectiveness.
- • The socialist group proposes a 3% minimum tax on wealth over €10 million, compared to Zucman's original 2% on wealth over €100 million.
- • Political tensions are high with left-wing factions supporting the tax and right-wing and centrist groups opposing any tax increases.
- • The budget aims to reduce the deficit to 4.7% of GDP, with a vote scheduled for November 4 before the Senate.
Key details
French economist Gabriel Zucman has publicly voiced strong opposition to a softened version of his proposed wealth tax, as parliamentary debates intensify over the 2026 budget. The contentious tax, targeting ultra-rich individuals, has become a focal point of political tensions between left-wing supporters and right-wing opponents.
During an appearance on France Inter, Zucman warned that the socialist amendment to lighten the tax would compromise its effectiveness. His original proposal envisioned a minimum 2% tax on net assets exceeding €100 million, with projected revenues of €15 to €20 billion. In contrast, the socialist deputies suggest a 3% tax starting at a much lower €10 million threshold but with numerous exemptions — including family businesses and "innovative" companies — aiming to soften government opposition. Zucman cautioned that such exemptions could favor billionaires, enabling tax optimization and evasion, reminiscent of failures with the 1981 ISF (Impôt de Solidarité sur la Fortune) tax which was undermined by loopholes allowing wealthy elites to avoid contributions.
This difference in approach has sparked criticism within the left spectrum, notably from La France insoumise, which accuses the socialist party of compromising too heavily with the government bloc. Socialist deputy Philippe Brun defended the party's strategy, emphasizing pragmatism in the budget negotiations.
The broader context involves ongoing debates in the National Assembly on the 2026 budget, which aims to reduce France's budget deficit to 4.7% of GDP. The Finance Committee already rejected the revenue section, highlighting deep divisions. The Socialist Party has threatened to censure Prime Minister Sébastien Lecornu’s government if the budget does not incorporate stronger social justice measures, including taxing the ultra-rich and large inheritances. The final budget vote is scheduled for November 4 before the Senate, where the right-wing predominates.
Zucman’s firm stance underscores the complexities facing France’s fiscal policy, as the government balances deficit reduction with demands for wealth equity. The debates illustrate the political struggle to design an effective tax on ultra-wealth amid fractured parliamentary dynamics and recent sovereign credit rating downgrades.
As discussions continue, the timeline for the Zucman tax vote remains uncertain, with deputies continuing to contest central elements this weekend. Gabriel Zucman’s warnings signal that only a robust, exemption-free minimum wealth tax may succeed in ensuring fiscal fairness and significant revenue for France’s 2026 budget.