What happened
In a move seen as a potential shift to a more left-leaning economic stance, France’s Prime Minister Sébastien Lecornu reportedly proposed to the Socialist Party (PS) the creation of a tax on financial wealth. The plan would target wealth held in financial holdings while explicitly excluding wealth tied to professional assets. The briefing comes as the PS is already gathered at Matignon for talks following Lecornu’s remarks about governance without recourse to the constitutional 49.3 mechanism.
Leaders from the PS were meeting at Matignon to discuss the government’s direction, following public statements from Lecornu about budgetary measures designed to bolster purchasing power. The conversations, ongoing over a new round of consultations, follow calls from the left for a wealth tax (often associated with the so-called Zucman tax).
The tax idea on the table
According to sources close to the prime minister, the government has floated a tax on financial wealth, specifically on holdings that do not affect professional or business assets. The aim is to bolster revenue linked to households’ financial assets while protecting professional capital. The government signaled that this option could be compatible with maintaining flexibility in the budget, and that the Socialists would be allowed to present a separate Zucman-style tax proposal for the wealthy, though the administration does not intend to back such a measure.
Officials stressed that the proposal is still in the consultation phase and subject to negotiation. A government aide noted, off the record, that while it is possible to entertain a wealth tax approach in parallel, the premier does not view a broad wealth tax as a ready-to-implement solution and seeks a path that avoids destabilizing the economy or employment.
Renouncing the 49.3: a procedural pivot
In parallel, Lecornu announced a significant procedural pivot: he will not use Article 49.3 of the Constitution to push through the budget. “I have decided to renounce the 49.3,” he stated in a brief address, arguing that governance should avoid forcing minority support and that compromise is possible without renouncing core convictions. This step, described by aides as “the most parliamentary moment” of the Fifth Republic, opens space for negotiations with opposition and allied groups alike.
Reactions across the spectrum
The move triggered mixed reactions across the political spectrum. The Republicans (LR) held a remote briefing expressing caution about negotiations, with some members pushing for a larger political stake in the cabinet and pressing questions on immigration and broader policy direction. On the opposite flank, far-left and far-right voices urged rapid clarity on pension reform and fiscal choices. The idea of a financial-wealth tax was a focal point of debate: some PS lawmakers signaled openness to examining the measure, while others emphasized the need for more immediate aid to households.
What it means for the budget and the left
Leaders on the left are urging a broader discussion on tax fairness and purchasing power, with some pressing for a Zucman-style tax on the very wealthy. The government is positioning the financial-wealth tax as a possible compromise that would not touch professional capital, thereby aiming to win cross-party support without triggering broad economic disruption. At the same time, the PS is invited to propose its preferred tax instruments in a voteable framework, with the government signaling it would not extend support to a blanket wealth tax.
What’s next
Upcoming meetings will determine whether the PS agrees to the financial wealth proposition or pushes for alternative mechanisms. Lecornu will continue talks with environmental and other opposition groups in the days ahead, while the budget package—relying on power of purchasing measures—will be refined to secure a functioning majority. The central question remains whether a middle ground can be found that both stimulates growth and addresses social equity without triggering a broad political backlash.
Why this matters
The discussions at Matignon reflect a broader rift within the left about how to finance social protections while maintaining economic competitiveness. The balance Lecornu seeks—between targeted wealth measures and careful protection of professional assets—speaks to a careful calibration of fiscal policy in a moment of political flux. The outcome will shape not only the budget but the tone of the government’s reform agenda as it navigates a diverse parliamentary landscape.
