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| French State Budget | |
|---|---|
| Name | French State Budget |
| Native name | Loi de finances |
| Jurisdiction | France |
| Type | Annual budget law |
| Authority | Parliament of France |
| Enacted by | National Assembly (France) and Senate (France) |
| Created | Ancien Régime (evolved) |
| Minister | Minister of the Economy, Finance and Industrial and Digital Sovereignty |
French State Budget The French State Budget is the annual Loi de finances presented by the Prime Minister of France and prepared by the Ministry of the Economy, Finance and Industrial and Digital Sovereignty for adoption by the Parliament of France, allocating resources across ministries such as Ministry of the Interior (France), Ministry of Armed Forces (France), Ministry of National Education (France) and agencies like Agence France Trésor. It establishes projections for receipts from institutions including Direction générale des Finances publiques and expenditures for programs administered by entities such as French Social Security branches, Conseil d'État oversight, and EU-related commitments under Treaty on European Union. The budget interacts with instruments used by authorities like the European Central Bank, the Organisation for Economic Co-operation and Development and ratings by agencies including Standard & Poor's.
The legal basis for the State Budget derives from articles in the Constitution of France and laws such as the Ordinance of 1959 implementation and the Organic Law on Budget Acts (LOLF) enacted after debates involving the Council of Ministers (France), the Constitutional Council (France), and parliamentary commissions including the Finance Committee (National Assembly). The budget law distinguishes between general accounts managed by the Trésor public and special accounts like those governed by the Conseil constitutionnel decisions and oversight by the Cour des comptes. It must respect commitments from international agreements such as the Stability and Growth Pact and decisions by the European Commission.
Preparation is led by the Minister of the Economy, Finance and Industrial and Digital Sovereignty working with the Budget Directorate (France) and agencies such as the Inspection Générale des Finances. The process begins with multi-year frameworks drawn from Stabilisation policies and government programs set by the Président of the Republic (France) and Prime Minister of France; submission to National Assembly (France) and Senate (France) follows, with scrutiny by the Finance Committee (Senate) and amendments by rapporteurs from parties like La République En Marche!, Les Républicains, Socialist Party (France), National Rally (France). The Constitutional Council (France) can be seized for constitutional review and the final vote yields the Loi de règlement that closes accounts.
State revenues originate from taxes collected by Direction générale des Finances publiques including VAT applied under rules similar to EU directives, Impôt sur le revenu collected from individuals, corporate levies like Impôt sur les sociétés, excise duties including on hydrocarbons linked to policies debated in the Assemblée nationale and Sénat. Non-tax revenues include dividends from state-owned companies such as Société nationale des chemins de fer français (prior to reforms), Électricité de France, and contributions from social schemes administered by entities like Caisse des Dépôts et Consignations. Transfers and grants involve partnerships with European Commission, regional authorities such as Île-de-France, departments like Bouches-du-Rhône, and municipalities exemplified by Paris.
Major spending lines fund sectors including defense via the Ministry of Armed Forces (France) and procurements tied to contractors like Dassault Aviation; education budgets routed to Ministry of National Education (France); health spending coordinated with agencies like Agence nationale de santé publique and hospitals under laws influenced by World Health Organization recommendations. Social protection programs finance pensions through schemes such as those administered in relation to Union européenne coordination, unemployment benefits linked to Pôle emploi, and family allowances via the Caisse nationale des Allocations Familiales. Investment programs include infrastructure projects with partners like RATP Group and rail upgrades tied to European Investment Bank financing.
Fiscal policy is shaped by commitments to the Stability and Growth Pact and guidance from the European Commission and Eurogroup discussions, with the Agence France Trésor managing borrowing through sovereign issuances like OATs marketed to institutions including Banque de France and international investors such as BlackRock. Deficit targets have been the subject of negotiation involving leaders like Emmanuel Macron and former ministers including Bruno Le Maire, and ratings assessed by Moody's Investors Service influence debt servicing. Debt sustainability analyses reference metrics used by the International Monetary Fund and Organisation for Economic Co-operation and Development.
Execution is performed by directorates such as Direction Générale des Finances Publiques with internal control from Inspection Générale des Finances and external audit by the Cour des comptes, whose reports are debated in parliamentary committees like the Finance Committee (National Assembly). Anti-fraud operations coordinate with agencies such as Tracfin and legal reviews by the Conseil d'État and prosecutors like the Parquet national financier. Transparency initiatives reference standards from International Monetary Fund missions and reporting aligned with European System of Accounts.
Historical evolution includes fiscal centralization since the Ancien Régime, reforms during the Third Republic (France), modernization in post-war periods influenced by the Bretton Woods Conference and the creation of the European Union, and transformations under governments led by figures such as François Mitterrand, Jacques Chirac, Nicolas Sarkozy, François Hollande and Édouard Philippe. Recent reforms include the introduction of the Organic Law on Budget Acts (LOLF), tax changes under finance ministers including Bruno Le Maire and crises responses to events like the 2008 financial crisis and the COVID-19 pandemic in France, with debates engaging parties such as La France Insoumise and think tanks including Institut Montaigne.
Category:Public finance of France