French PM urges big business to return purchasing power to the public

Businesses that make big profits in France should “return buying power” to the people, Prime Minister Élisabeth Borne has said, as the cost of living continues to rise.

The PM also said that she “had not ruled out” a new corporation tax on bumper profits.

In an interview with Le Parisien, Ms Borne said that she would prefer for major enterprises to “drop their prices for the consumer to give them back their purchasing power”. She said that this option would be “more effective and impactful for people in France”.

She said: “No one will understand that businesses reap exceptionally-high profits even as people in France are worried about their purchasing power. In the current period, everyone must be responsible.”

Ms Borne added that she would be “paying attention to what [these companies] do”, and checking that those that have already made changes “respect them”.

Profit taxes and private jets

The question of whether to impose extra taxes on massive corporation profits has already been a topic of debate in parliament. Some MPs have called for it, while PS secretary Olivier Faure last week announced that he would suggest a party referendum to his Nupes (political party) partners.

Ms Borne also addressed the question of private jet use, after the issue became controversial last month. She did not confirm any taxes or sanctions for their use, but said: “Owners of private jets must, like everyone, participate in the reduction of greenhouse gas emissions.”

Read also:Stop lit-up advert screens and private jets, urge French campaigners

She said that it was important for “the most well-off” to show a good example. She added that she was set to “action a global and planned movement” on eco-friendly measures.

This is set to include a “green fund” of 1.5billion for local groups and authorities “to help them speed up the ecological transition”, she said. The funds could go towards the rehabilitation of public land to avoid urban sprawl, and the eco-friendly renovation of public buildings such as schools.

It could also “help bring nature into towns” or install “park and ride” car parks on the outskirts to limit traffic.

She added that the government would “not let energy prices explode” and would limit “rises”, even as energy prices continue to soar.

The current measure, known as the ‘price shield’ (bouclier tarifaire), is set to come to an end in its existing form at the end of the year. Ms Borne said that “we will maintain measures to limit the rises in energy prices. And we will impose specific measures to help the most vulnerable”.

Inflation down slightly but prices still high

Ms Borne’s comments come against a backdrop of rising prices and high inflation.

However, after some record rate rises, inflation was at 5.8% year-on-year in August, a drop of 0.3% compared to July’s rate of 6.1%, showed the latest figures from statistics bureau Insee.

This drop is “due to the slowdown in energy prices”, Insee said in a statement. Despite this, in August, food prices rose by 7.7% overall.

Similarly, the Indice des prix à la consommation harmonisé (HICP), which serves as a basis for comparison at the European level, rose by 6.5% over one year in August, compared with 6.8% in July. Over one month, the HICP rose by 0.4%, compared with 0.3% the previous month.

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