Government Goal: Reduce the deficit in 2012
The second austerity plan presented Monday by François Fillon make an additional effort of 7 billion euros in 2012. Which 4 billion at the expense of consumers and taxpayers.
“The word bankruptcy is no longer an abstract word,” warned Monday Francois Fillon, in the prologue of his presentation of a new austerity plan for the future. The government’s goal is to reduce the public deficit to 4.5% of GDP in 2012 with economic growth of only 1%. This is, once again stressed the Prime Minister, the precious “triple A” of France . The extra effort provided by the second austerity plan in less than three months amounted to 18.6 billion euros for 2012 and 2013, of which 7 billion in 2012 in addition to 11 billion announced by François Fillon on 24 last August . The Prime Minister ensures that the plan be made ”substantially all” of the effort on the more affluent. That’s not true.
Among the key measures of the new austerity plan include the rehabilitation of the reduced rate of VAT from 5.5% to 7%, excluding food, energy and services for the disabled. This measure will concern in particular the reduced rate in the restoration and renovation work in the building, but also the price of books, many types of real estate sales, passenger transport (rail, road, sea, water, air , taxis or lifts), imports of works of art, the services of lawyers in legal aid or the provision of waste collection. Expected gain: 1.8 billion euros per year,that ultimately will pay the whole of the French .
And that’s not all. The rates of income tax and wealth tax in 2012 and 2013 will be de-indexed for inflation, that is to say, frozen at 2011. Mechanically, many taxpayers will switch to an upper end, so pay more taxes. The government expects 1.7 billion in revenues in 2012 and 3.4 billion in 2013. Moreover, the implementation of pension reform will be accelerated by one year.
Freeze benefits and accelerating the pension reform
Raising the age of 60 to 62 will also be advanced from 2018 to 2017. What needs to bring 100 million in 2012, 500 million in 2013, for an overall saving of 4.4 billion euros by 2016. Other action affecting the greatest number: the revaluation of the most social benefits, excluding pensions and welfare benefits (mainly child allowances and housing subsidies) will be frozen at 1% for 2012, not indexed to inflation but growth. This represents a saving of 500 million euros.
On the corporate side, a temporary increase of 5% of the income tax hit in 2012 and 2013 those with a turnover exceeding 250 million euros. Expected revenues totaled 1.1 billion euros per year. Or a total bill rising to 6.2 billion euros in 2012, if we include measures of austerity plan first announced in August.The state will also begin to diet, but to a lesser extent: the salaries of the president and ministers will be frozen, a measure before totu symbolic. In all, without anyone even know the details of savings, spending will be reduced by $ 1.5 billion in 2012.
These households will pay the heaviest price of rigor: 4.1 billion euros for the second austerity plan – which it will probably add several million related to increased control of health spending, which could result delisting by new medications or less support from co-payments – 6.1 billion added to the measures passed last August. Or a bill of just over ten billion euros.
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