From
leblogfinance.comNicolas Sarkozy has persisted and signed on a la TVA sociale, even if the policy has cost him the blue wave he could have used to surf over the criticisms of the Socialist party and other opposition.? The TVA sociale would be trialled, Sarkozy confirmed on Wednesday. During a visit to a textile factory in Tourcoing, Prime Minister François Fillon affirmed the day before he did not want to "close the book" on the TVA sociale "on the pretext of it being poorly explained".
Segolene Royale has called on the President to "tell the truth" on the policy of TVA "sociale" instead of "packaging it in a political speech" which according to her is the "opposite of what will be done".
I – Sarkozy : la TVA sociale will be trialledNicolas Sarkozy confirmed Wednesday that the principles associated with the TVA sociale would be put into practice...but in the context of a "trial". It remains to be seen how one can "trial" such a measure in a concrete fashion. For beyond the speeches waxing lyrical, there will come a time to face the realities. "If this trial is successful, we will expand it. If it is not important, not useful, we won't" said the Head of State to the presidential majority gathered at the Elysée. Note in passing that the new President attempting to show that the French economy will have to bring into existence measures that he is not so sure will be useful. A way of gradually reducing unemployment in the public service perhaps?
Mr Sarkozy had to intervene directly, between the two rounds of legislative voting, to re-assure voters that the TVA sociale would not be brought in if it suceeded in reducing the purchasing power of the French. After ten days of controversy on the subject, he finally decided to breathe new life into a measure mentioned during has campaign to not "sit back with arms folded in the face of offshoring". Mr Sarkozy pointed out that Germany "has just trialled it" and that "Denmark has adopted it".
The French President has however revealed that he took account the warnings of the policy, which consist of swinging a part of business' social security financing towards households, through a simultaneous lowering of employer's contributions and an increase in TVA.
"Si the TVA sociale is not effective in preventing offshoring, if the TVA sociale is not good for employment and purchasing power, well, we won't have a TVA sociale" he explained to MPs.
Everything seems so simple for him, would the french economy be steered as easily as a yacht?
On the other hand, if the TVA sociale “contributes to slow offshoring, if it is good for employment, good for growth and does not penalise purchasing power, then we will introduce it." The policy has certainly got a lot on its plate if it is to cross all these boxes. A roundabout way of progressively abandoning the project without a loss of face...
According to survey out Wednesday, 67% of people asked rejected the measure. This CSA/Profession politique study points the spotlight on the impact of the theme in the second round of elections. "Messrs Fillion and Borloo "have been extremely clumsy", and this error "has cost us 50 to 100 MPs", denounced UMP MP Renaud Dutriel on Tuesday. Former Prime Minister Jean-Pierre Raffarin seems to share Dutriel's analysis.
II – Fillon : the book is not closed
Prime Minister François Fillon affirmed Tuesday that he did not want to "close the book" on the TVA sociale "on the pretext of it being poorly explained". "Everybody recognises that you cannot fund social security purely from work. The more charges you levy on work, the more jobs go away" explained Fillion, reaffirming that all political parties "from across the spectrum are saying one way or another (...) that we need to find a new tax base". "But there is only one new tax base, it's consumption, it's value added" he continued. The Prime Minister who was travelling with the new Minister of the Economy, Christine Lagarde, has promised the opening "of a great debate in front of the French" as soon as he receives the findings of the TVA sociale report, due in July. This task, given to Mr Borloo, will now be compiled by Mrs Lagarde.
During her monthly press conference in Paris, the Medef president broached the subject of TVA sociale. She thought that "reflection and debate should be continued" on this subject to see if such a reform would allow "France to become more competitive and respond to the growing financial needs of the social security system."
III - Ségolène Royal asks for the truth on the TVA "sociale"
Ségolène Royal has called on Nicolas Sarkozy to "tell the truth" on the TVA sociale policy. "How can you trial a tax? Either the tax is there or it isn't" she said on the
Question d'info LCP-Le Monde- France Info Wednesday. In what regards the practical application side of things, she isn't completely wrong.
The Socialist president of the Poitu-Charentes region also contested "that a tax on consumption could lower the costs of living". "A political speech that says a tax on consumption lowers living costs is not a speech of truth" she added. "Hence, I reproach Nicholas Sarkozy for not clearly saying what he wants to do (...) He packages the truth in a political speech which corresponds to the opposite of what will be done."
Royal also estimated that the "tax package" confirmed by Nicolas Sarkozy was an "unbearable expense for France". "The government estimates it will cost eleven billion euros, but the experts agree that this will cost 15 to 20 billion euros, which comes to one hundred billion over five years" she advanced. "Keeping in mind the current budget deficits and the levels of debt, this spending is unbearable for France." It is true that the government has taken a few liberties to dress the figures it seems, but the Accounts Court and Phillipe Séguin are watching over to make sure that our fellow citizens are faced with the reality of things.
For Ségolène Royal, these measures do not allow any growth in employment or the competitiveness of firms and "it is a tax package that is socially unjust".
Labels: Francois Fillon, Nicholas Sarkozy, Segolene Royal, TVA Sociale