France’s National Assembly rejected the government’s 2027 finance bill in first reading on Wednesday, voting 458 to 0 against the revenue part of the text. Under the Assembly’s rules, rejecting the first part voids the whole bill in that chamber. RIA Novosti reported the result citing the Assembly’s own statement, and said the vote came amid broad disagreement among the chamber’s groups, including over the government’s savings measures.
The vote ends two weeks of debate in which deputies heavily rewrote the draft, adopting a string of opposition amendments that changed the bill’s fiscal balance. One late change removed a tax exemption for offshore wind installations, carried with votes from the Rassemblement National and Les Républicains. None of those amendments survives: the Senate now takes up the government’s original, unamended text, with its examination due to begin on November 20, and any final compromise will have to be negotiated between the two chambers.
The government’s plan, presented by Prime Minister Sébastien Lecornu, rests on a fiscal effort of roughly 54 billion euros and a public deficit near 5 percent of GDP in 2027. That arithmetic is the point of contention. The finance committee had already rejected the revenue part in October, by 31 votes to 3, after amendments adopted in committee were estimated to widen the deficit by about 10 billion euros, and the spending part of the bill was never reached in the Assembly.
For markets, the rejection lands on a French bond premium that is already at crisis-era levels. France’s 10-year spread over Germany closed at 170 basis points in late October, after touching 177 basis points, its widest since 2011, and Moody’s kept France at Aa3 with a negative outlook on October 23 on the stated condition of a deficit-reducing budget for 2027. A government that cannot pass its budget in the lower house, and whose fallback tools are Article 49.3 or ordinances, now has to find that deficit path in the Senate instead.