Auteurs: Mathias André, Antoine Bozio, Malka Guillot et Louise Paul-Delvaux
Article publié dans: Fiscal Studies, Vol. 36, No. 4, December 2015
Abstract: France was modestly hit by the ﬁnancial crisis compared with its neighbours but the recovery has been particularly slow. The shock to the public ﬁnances was nonetheless signiﬁcant, and came on top of an already weak pre-crisis ﬁscal position.Part of this shock is expected to be permanent and the French government has so far mostly used increases in taxation to bring borrowing under control. However, in 2014, spending cuts took over as the main tool for balancing the public ﬁnances.
Despite the signiﬁcant ﬁscal adjustments that have been required, the crisis has not been used as an opportunity for reforms. Some reforms to labour and service markets have been carried out, but there have been no radical changes. While some tax changes, such as cuts to employer social security contributions and an increase in reduced rates of VAT, have improved the efﬁciency of the tax system, overall the tax and beneﬁt system continues to be plagued by complexity and a sheer lack of transparency. As the remaining effort for balancing the public ﬁnances seems likely to rely on spending cuts, the overall efﬁciency of the policy response to the crisis will depend in large part on how these are done.