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KEY FIGURES FROM THE 2017 BUDGET Press conference, 20 September 2016 DBP FOR 2017 Presented by MICHEL SAPIN, Minister for the Economy and Finance CHRISTIAN ECKERT, Minister of State for the Budget and Public Accounts

Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

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Page 1: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

KEY FIGURES FROM THE

2017 BUDGET

Press conference, 20 September 2016

DB

P F

OR

2017

Presented by

MICHEL SAPIN, Minister for the Economy and Finance CHRISTIAN ECKERT, Minister of State for the Budget and Public Accounts

Page 2: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

2

Three battles since 2012

• Fiscal consolidation

• Stimulating growth and jobs

• Social justice

Page 3: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

3

“A much greater fiscal consolidation effort since 2012 than in

Germany”

Key: The differential between the French and German fiscal deficits widened by 2 percentage points of GDP between 2007 and 2012. It will narrow by 2 percentage points of GDP between 2012 and 2017.

0.2 - 0.1 0.0

- 2.5

- 4.8

- 2.7

-8.2

-7.2

-6.2

-5.2

-4.2

-3.2

-2.2

-1.2

0.2

1.2

2.2

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017Germany France

Page 4: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

4

“All of the increases in businesses’ taxes and contributions

since 2011 will be eliminated in 2017”

Sources: Calculations by the Ministry for the Economy and Finance. All of the taxes and contributions paid by businesses, except for indirect taxes and direct local taxes.

Cumulative change in discretionary tax measures affecting businesses (€bn)

-5

0

5

10

15

20

25

2011 2012 2013 2014 2015 2016 2017

Page 5: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

5

“Profit margins have virtually returned to their historical

level”

29%

30%

31%

32%

33%

34%Average 2000-2007:

32.5%

2016-2017: 32%

2013Q4: 29.8%

Non-financial corporations’ profit margins (gross operating surplus/value added)

Sources: Insee, quarterly accounts and DBP forecasts

Page 6: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

6

“A very brisk recovery in investment since the end of 2014”

Sources: Insee, annual accounts and DBP forecasts

+ 1.2% + 0.9%

+ 1.6%

+ 2.7%

+ 3.8% + 3.5%

0.0%

0.1%

0.1%

0.2%

0.2%

0.3%

0.3%

0.4%

0.4%

2012 2013 2014 2015 2016 2017

Real growth rate of non-financial corporations’ GFCF

Page 7: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

7

“The market sector is posting net job growth again”

Sources: Insee and DBP forecasts

Year-on-year change in non-farm market sector employment

- 185

- 253

+ 56 + 56

- 107

- 25

- 62

+ 97 + 131

+ 153

-300

-250

-200

-150

-100

-50

0

50

100

150

200

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Page 8: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

8

“Measures taken since 2012 have protected living standards

for the six lowest income deciles"

0.5

0.1 0.0 0.0 0.0 0.0

0.0 -0.1

-0.1 -0.2 -0.3

-0.2

-0.1

0.0

0.1

0.2

0.3

0.4

0.5

0.6

1 2 3 4 5 6 7 8 9 10

Impact of discretionary measures on households’ living standards between 2012 and 2017 (%)

Bottom decile Top decile

Sources: Calculations by the Ministry for the Economy and Finance Key: Assessment of the impact by income decile on households’ living standards from tax and benefit measures taken since May 2012 Between 2012 and 2017, households in the bottom income decile saw their living standard rise by an average of 4.7% as a result of the measures taken.

Page 9: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

9

“In aggregate, the measures taken since 2012 did not lead to an

increase in income tax revenue”

Cumulative change in discretionary income tax measures (€bn)

Sources: Calculations by the Ministry for the Economy and Finance. All of the income tax measures passed since May 2012 (excluding the reform of earned income tax credit (PPE)).

0

1

2

3

4

5

6

7

2012 2013 2014 2015 2016 2017

€b

n

Page 10: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

10

“Our measures have cut middle-class tax bills”

- 0.3

- 1.0 - 1.5

- 1.2

- 0.3

+ 1.0

+ 4.0

-0.2

-0.1

0.0

0.1

0.2

0.3

0.4

0.5

D1 D2 D3 D4 D5 D6 D7 D8 D9 D10

Change in discretionary income tax measures by decile (€bn)

Bottom decile Top decile

Sources: Calculations by the Ministry for the Economy and Finance. Key: The chart shows the impact of income tax measures passed since 2012 on the total income tax bill for each income decile.

Page 11: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

11

“We still expect annual growth of 1.5% in 2016 and 2017.”

+ 0.2%

+ 0.6% + 0.6%

+ 1.3%

+ 1.5% + 1.5%

2012 2013 2014 2015 2016 2017

Sources: Insee, annual accounts and DBP forecasts

Page 12: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

12

“Our deficit targets have also been maintained”

-5.1% -4.8%

-4.0% -4.0% -3.5%

-3.3%

-2.7%

-0.6%

-0.5%

-0.4%

-0.3%

-0.2%

-0.1%

0.0%

2011 2012 2013 2014 2015 2016 2017

Public deficit

Sources: Insee, DBP forecasts

Page 13: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

“All additional expenditure measures are paid for”

Additional expenditure: €9bn

Central government expenditure* 5.7

Transfers to local authorities 1.2

Healthcare 0.7

Cut in contributions for self-employed craft

workers 0.1

Cut in corporate income tax for SMEs 0.3

Cut in personal income tax 1.0

13

Financing measures: €14bn

Adjustments to the Responsibility Pact 5.0

Social Security funds’ savings 1.5

Local government savings 1.0

Interest expenditure 1.2

Fighting tax fraud 1.9

“Investment in the Future” programme

disbursements 1.2

Tax disputes 0.7

Misc. tax measures 1.3

Consolidation announced in the Stability Programme: €5bn

* Education and youth, jobs, security and culture.

Page 14: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

14

“All general government sectors have made considerable

efforts”

0%

1%

2%

3%

4%

5%

6%2

00

0

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

Average growth from 2012 to 2016: 1.6 %

Average growth from 2000 to 2012: 3.6%

Sources: Insee and DBP forecasts

Nominal growth rate of public expenditure

Page 15: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

15

“Following sharp rises between 2010 and 2013, the tax burden has

started to shrink”

41.0% 41.3%

42.6%

43.8%

44.8% 44.8% 44.7% 44.5% 44.5%

2009 2010 2011 2012 2013 2014 2015 2016 2017Sources: Insee and DBP forecasts

Aggregate taxes and social security contributions as a proportion of GDP (excluding tax credits)

Page 16: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

16

“This consolidation has finally enabled us to curb the growth of

public debt”

Sources: Insee and DBP forecasts

64.4%

89.6%

96.2%

96.1% 96.0%

60%

65%

70%

75%

80%

85%

90%

95%

100%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

2007-2012: + 25.2 GDP percentage

points

2012-2017: + 6.4 GDP percentage

points

Page 17: Cadrage macroéconomique et trajectoire des finances publiquesproxy-pubminefi.diffusion.finances.gouv.fr/pub/document/18/21470.p… · Minister for the Economy and Finance CHRISTIAN

DB

P F

OR

2017

Save the date:

Presentation of the

Draft Budgetary Plan

on Wednesday,

28 September