Essay About Tax Reforms And Public Finances

Expansion of Saudi Date Company to France
Frances economy has ended up being moderately versatile, with entrepreneurial movement encouraged by such institutional qualities as solid assurance of property rights and a genuinely effective administrative structure. Different change measures have been embraced to build the economys aggressiveness and adaptability, however general advance has been negligible.In 2014, France lost ground as the worlds fifth largest economic power to the England. The country has been finding it difficult in the economic crisis, although GDP growth recovered (1.3%) in 2015. Regardless, a positive change is expected in 2017, due to a decrease in the unemployment rate, a rise in wages and greater access to credit for cheap consumption. However, Brexit is expected to negatively impact external demand.In 2016, there were high hopes for a better year than the year before. The Government succeeded in straightening out the public finances, and the budget deficit was reduced to 3.3%, in accordance with Frances agreements with the European Commission in 2016. This adjustment was largely due to the increase in taxes (mandatory contributions) and the control of public spending. The Tax Credit for Employment and Competitivity and the fall of energy costs allowed companies to improve their level of profits. The weakness of the Euro also helped to boost sales. Investments have risen in industry as companies have gained in competitiveness. On the other side, public debt has continued to increase, rising to 97% of GDP. Despite the existing state of emergency and the anti-terrorist laws in the country, France was hit by a deadly terrorist attack again in Nice during July 2016, creating a climate of insecurity. This in turn has affected tourism negatively. Adding to this, the social climate was also an issue due to protests against a recent labour law. Along with this another issue was the controversies surrounding the burka. Moreover, there was public anger concerning the removal of the migrant jungle of Calais. We also need to examine the upcoming presidential and legislative elections. Many resignations from the government have taken place while President Hollande announced that he would not seek to be reelected. The republican candidate, François Fillon, has had his image damaged by allegations of misuse of public funds, whilst the far right is rising in a context of protest the current Government. As per the budget of the country, it forecasts an ambitious growth rate (1.5% of GDP) and many tax reforms. The tax reforms include establishment of income tax withholding, tax cuts for the middle class and measures in favor of companies to promote new businesses to start up. It still allows for priority to primary and higher education. These reforms are paramount in order for the country to face its many challenges which are reducing the budget deficit, controlling the rise of public spending, promoting employment, improving competition, promoting industrial development and ensuring fair law & justice.