The resistance shown by the French economy at the end of 2022 relieved the public accounts. Last year’s state deficit thus turned out to be nearly 20 billion euros lower than the latest forecasts made at the end of the autumn. An extremely substantial amount due in particular to generous tax revenues.

The budget balance of the state sphere thus stood at -151.5 billion euros at the end of 2022, according to data presented this Wednesday to the Council of Ministers by Bruno Le Maire and Gabriel Attal. Admittedly, the amount is still gargantuan, if we compare it with the pre-Covid years, when it sailed between 70 and 90 billion. But this level is despite everything lower by 19.5 billion than the -171 billion which had been announced in November during the examination of the amending finance bill, but also to the -170.8 billion observed at the end of 2021.

Growth that resists

This good news can be explained in particular by additional tax receipts of 7 billion euros. This week, INSEE announced that activity in France had held up better than expected (+0.1% in the fourth quarter, for growth of 2.6% over the year). This was reflected in particular in record corporate tax (IS) revenue, with a better than expected fifth installment having brought in an additional 3 billion.

“State tax receipts reached 62 billion euros: this is the highest amount in history, while we have the lowest rate in history”, i.e. 25% against 33% in 2017, boasted Gabriel Attal in an interview with “Figaro”. In fact, the IS had never exceeded 60 billion. Income tax was also boosted by the good performance of the job market, posting 1.6 billion more receipts. The surplus is 2.5 billion for other taxes.

Objective maintained

The government was also able to count on lower spending of 12 billion. This “is essentially due to the disbursement schedule for several measures relating to the protection of households, businesses and public authorities, which will be gradually disbursed during the winter of 2022-2023”, we say at Bercy. Clearly, part of the payment of the planned aid (for heating with fuel or wood, to cushion the shock of inflation for businesses) will only take place in 2023. In the same way, the credits that the executive had planned for the purchase of minority shares in EDF have been postponed to 2023.

It still remains to have the figures of the accounts of the Social security and the local communities to have in March the final level of the public deficit. Officially, the objective remains to reach the threshold of 5% of GDP. But given the good surprises observed for the State, and while the finances of local authorities seem to be doing well, Gabriel Attal admitted not to “totally rule out a better landing”.