France Budget Deficit Narrows in January

France’s state budget deficit narrowed to EUR 9.7 billion at the end of January 2026, compared with EUR 17.3 billion a year earlier. Total revenues rose sharply by 49.4 year-on-year to EUR 36.3 billion, supported by stronger VAT receipts and a significant increase in non-tax revenues, notably the reimbursement of unused endowments under past investment programs. Net tax revenues increased to EUR 28.7 billion, although income tax and corporate tax collections declined annually. Meanwhile, total expenditure rose by 4.6% to EUR 39.6 billion, driven by higher defense spending, increased investment outlays, and larger transfers to the European Union, partly offset by slightly lower operating costs and debt servicing expenses. Special Treasury accounts recorded a deficit of EUR 6.5 billion, widening from EUR 3.8 billion a year earlier, largely due to timing effects related to VAT transfers to local authorities.

France’s central government budget deficit narrowed to EUR 124.7 billion in the January-December period of 2025, down from EUR 156.3 billion a year earlier. Government revenues rose 8.6% year-on-year to EUR 387.7 billion, supported by higher net income tax, corporate tax, VAT, and other net tax receipts. Non-tax revenues increased by 3.4%, reflecting higher dividend receipts, administrative fines, and other miscellaneous receipts, despite lower EU contributions linked to the co-financing of the National Recovery and Resilience Plan. Meanwhile, total expenditures slightly declined by 0.2% to EUR 510.2 billion, driven by higher debt service costs, increased spending on energy services and military operations, and higher transfers to local authorities and the EU, partly offset by reduced payments to public operators and the removal of the Covid-19 debt amortization program. Special Treasury accounts posted a EUR 2.3 billion deficit, improving from EUR 2.4 billion in December 2024.

France’s central government budget deficit narrowed to EUR 155.4 billion in the January-November period of 2025, from EUR 172.5 billion in the same month a year earlier. Government revenues rose 6.3% year-on-year to EUR 331.8 billion, supported by higher net income tax , corporate tax, and other net tax receipts. Non-tax revenues also increased by 3%, reflecting higher dividend receipts, administrative fines, and treasury withdrawals, despite lower EU contributions linked to the co-financing of the National Recovery and Resilience Plan. Meanwhile, total expenditures went up by 1.4% to EUR 468.7 billion, driven by temporary debt service costs, increased spending on energy services and military operations, and higher transfers to local authorities and the EU, partly offset by reduced payments to public operators and the removal of the Covid-19 debt amortization program. Special Treasury accounts posted a EUR 18.5 billion deficit, improving from EUR 22.5 billion in November 2024.