The right-wing Senate voted on the night of Wednesday, April 22 to Thursday, April 23, with modifications, the second draft budget for 2020 proposed by the French government to support the economy in the face of the coronavirus crisis, to 110 billion euros.

After the National Assembly, the text was adopted at first reading by the Senate by 320 votes for and 16 against (the CRCE group with a communist majority). Deputies and senators will meet Thursday in joint joint committee to agree on a common text. The two chambers will still have to approve this agreement in the process. 

This crisis budget, with considerably heavier expenses, expects an 8% drop in GDP in 2020, a public deficit of around 9.1% of GDP and a debt of 115% of GDP. It brings to 24 billion euros the credits intended for partial unemployment and provides 20 billion euros to recapitalize strategic companies in difficulty, like Air France.


It raises to seven billion euros the solidarity fund for very small businesses and the self-employed, an amount increased by 2 billion euros by senators, against the advice of the government. It also includes aid for the most modest households (recipients of social minima) of 150 euros, plus 100 euros per child.

Against the advice of the government, the Senate voted to uncap the tax exemption of overtime worked during the state of health emergency, as well as their exemption from social security contributions.

The senators have provided a tax credit for businesses which will have to remain closed beyond May 11, the date envisaged for the start of deconfinement, in particular in the hotel and catering, culture and events sectors. . They also provided for a "subsidiary loan mechanism" for SMEs that were refused a government guaranteed bank loan.

Lower VAT for gloves

With regard to the State's holdings, the Senate approved an amendment by the general rapporteur Albéric de Montgolfier (LR) aiming to guarantee "prior information" to the Parliament.

On the other hand, the amendments aiming to condition this aid to criteria of environmental stakes, as recommended by the High Council for the climate, were rescinded. 

Senators have also extended to all disinfectants as well as protective clothing such as gloves and gowns, the drop in the VAT rate from 20 to 5.5% voted by the deputies at first reading for masks and hydroalcoholic gel.

With AFP

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