(Bloomberg) -- France’s government plans to reduce the scale of proposed tax increases for employers as it seeks to preserve pro-business policies while also plugging holes in public finances, budget minister Laurent Saint-Martin said.
Reducing tax breaks for employing low-income workers was a key plank of the 2025 budget bill presented last month that aims to make €60 billion ($63.8 billion) of tax increases and spending cuts to reduce the deficit. The changes to levies paid by employers were expected to contribute around €4 billion to the effort.
Saint-Martin said the government is negotiating with allies in parliament for a “clear and frank” modification of the plan in the coming days.
“Supply side policies, the competitiveness of French firms and the attractiveness of our country must all be preserved,” Saint-Martin said Tuesday of France 2 television. “We are working on a compromise to have a less heavy hand.”
The budget minister confirmed the government will also make changes to a plan for €3.8 billion of savings by delaying the indexing of public pensions to inflation. Saint-Martin said the tweaks to protect the least well off pensioners will reduce the impact of the measure to around €3 billion.
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