PARIS (Reuters) – France will be able to channel funds held in popular tax-free savings accounts towards financing the defence industry under a newly adopted budget bill amendment, the finance ministry said on Wednesday.
Lacking an outright majority, the government pushed spending legislation in the 2024 budget bill through the lower house of parliament on Tuesday using special constitutional powers to bypass a lawmakers’ vote.
The version of the 2024 budget bill the government passed includes an amendment that opens the way for deposits in widely held Livret A savings accounts to be used to finance France’s defence industrial base.
President Emmanuel Macron has committed to ramping up France’s defence spending in the coming years to transform its armed forces and face new threats.
With more than 55 million Livret A accounts open, French banks pass on 60% of the 400 billion euros in deposits held in them to the Caisse des Depots public lender which in turn uses the funds for social housing and urbanism projects.
However, pressure is growing for the funds to be used for other public projects and the government floated the idea earlier this year of channeling some of the money towards the financing of new nuclear power reactors.
Savers can put nearly 23,000 euros in Livret A accounts, which currently bear a tax-free government-set interest rate of 3%.
(Reporting by Leigh Thomas; Editing by Toby Chopra)
