Hollande unveils reforms to help France’s hard-up

President François Hollande on Wednesday vowed to go "faster and further" with reforms as he announced a raft of measures to bolster France's stagnant economy including fairer income tax levels and a relaxation of Sunday shopping rules.

Hollande unveils reforms to help France's hard-up
François Hollande has announced a raft of reforms imed at boosting the country's most hard-up. Photo: Philippe Huguen/AFP

In an interview with Le Monde daily, Hollande promised to stick with the key plank of his economic policy – the Responsibility Pact – in the face of criticism across the political spectrum.

The Responsibility Pact offers businesses tax breaks of some €40 billion ($55 billion) in exchange for a pledge by companies to create 500,000 jobs over three years.

Hollande plans to finance this with €50 billion in spending cuts.

"I have set out a way forward. That is the Responsibility Pact," Hollande said.

"The aim is clear: to modernise our economy by improving competitiveness and supporting investment and jobs. The fact that the economy is today slower in Europe and in France does not mean that we should give up on this," he said.

"On the contrary, we need to go faster and further."

He added that any "zig-zag" would "make our policy incomprehensible and would not produce results."

Hollande said his Economy Minister Arnaud Montebourg would soon present "draft legislation on purchasing power which aims to boost competition for services offered to consumers."

The president did not provide detailed measures but said they would include an attempt to simplify construction permits and reform restrictive laws on Sunday shopping.

On fiscal policy, Hollande said the government would "simplify and make fairer the income tax levels for the … low-income taxpayers."

Hollande also announced plans to unify two social benefits for those who earn little or are in and out of work – the "prime pour l'emploi" (PPE) tax credit and the "RSA activité" allowance, to create one single payment for the most hard-up workers in a bid to "to promote a return to work and improve the pay of employees in a precarious situation".

The reform is set to make up for the fact France's constitutional court slapped down a key plank of the Responsibility Pact that would have reduced social charges for low-income employees aimed at putting more money in workers' pockets.

On Wednesday, the deeply unpopular Hollande held his first cabinet meeting since the end of the long summer holiday in France, with his government under severe pressure, particularly in terms of economic growth.

The French national statistics office said last week that the economy had stagnated in the first six months of the year, forcing the government to halve its forecast for growth this year to 0.5 percent.

Paris also said its deficit would be "around four percent" of gross domestic product this year, an upwards revision from the 3.8 percent forecast previously.

European Union rules state that countries should not have a public deficit above three percent of GDP.

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Timbre fiscal: Everything you need to know about France’s finance stamps

If you're doing a French admin task, you might be asked to provide a 'timbre fiscale' - here's what these are and how to get them.

Timbre fiscal: Everything you need to know about France's finance stamps

In France, you can buy  a very particular kind of stamp to cover the cost of a titre de séjour, or French passport, to pay your taxes, get an ID card if you’re eligible, or pay for your driving licence.

Basically a timbre fiscale is a way of paying a fee to the government, and some online processes – such as the tax offices – now have the more modern method of a bank transfer or card payment.

However there are plenty of official tasks that still demand a timbre fiscale.

In the pre-internet days, this was a way of sending money safely and securely to the government and involved an actual physical stamp – you bought stamps to the value of the money you owned, stuck them onto a card and posted them to government office.

They could be used for anything from paying your taxes to fees for administrative processes like getting a new passport or residency card.

These days the stamps are digital. You will receive, instead, either a pdf document with a QR code that can be scanned from a phone or tablet, or an SMS with a unique 16-digit figure. Both will be accepted by the agency you are dealing with.

Once you have the code you need, you can add this to any online process that requires timbre fiscaux (the plural) and that will complete your dossier.

You can buy them from a properly equipped tabac, at your nearest trésorerie, or online

Paper stamps remain available in France’s overseas départements, but have been gradually phased out in mainland France.