Large Individuals Slated for Removal from Senate Report on Government Subsidies to Major Corporations, Anticipated Total at EUR 211 Billion Next Year
In a bid to enhance accountability and promote fairness, French senators have proposed a series of measures aimed at improving the tracking and evaluation of public aid given to businesses. The senators' concerns stem from a lack of clarity regarding the aid received by large corporations, particularly those with more than 1,000 employees and a global net turnover of at least 450 million euros.
The senators' report highlights that hundreds of millions of euros in public aid were given to large corporations such as Michelin, ArcelorMittal, and LVMH, despite layoffs. Notably, Auchan received 636 million euros in tax exemptions and 1.3 billion euros in social security contribution exemptions between 2013 and 2023, while announcing plans to cut more than 2,300 jobs. ArcelorMittal received 298 million euros in aid, 41 million euros in social security contribution exemptions, and 40 million euros in CIR (research tax credit) in France in 2023. Michelin and LVMH collectively received 275 million euros in public aid in 2023.
The senators have proposed the imposition of full repayment of an aid if the company relocates within two years the site or activity that justified it. They have also suggested the creation, by 2027, of an annual updated table of public aid to businesses, according to their size, by INSEE.
In addition, the senators have proposed a "shock of transparency and rationalization", calling for a single window for aid devices and better framing of the aid when companies pay dividends. They believe that these measures will help ensure that public aid is being used effectively and equitably.
The report also notes that 84% of aid devices concern the economy, sustainable development, and culture. The State granted a total of 211 billion euros in public aid to businesses in 2023, according to the Senate's investigative commission. This aid includes subsidies, loans, tax exemptions, and social security contribution exemptions. Subsidies to businesses were 7 billion euros, while the public investment bank Bpifrance granted 41 billion euros in aid.
It is worth noting that France provides significant tax subsidies and mandatory social security contributions related to employment, especially for large firms. Tax subsidies for R&D in France are among the most generous in Europe, with an implied tax subsidy rate of about 36 percent for large profitable firms, which is significantly above the European average of around 15.7 percent.
However, the specific annual amount of public aid, including subsidies, loans, tax exemptions, and social security contributions, that the French government provides to large companies for 2023 is not directly detailed in the provided search results. To obtain a precise figure, one would likely need to consult detailed government budget reports or official economic reviews summarizing public aid distribution for 2023.
The senators' proposals come at a time when public scrutiny of corporate practices and government aid is at an all-time high. The call for greater transparency and rationalization in the use of public aid is expected to generate significant debate and potentially lead to reforms in France's business aid policies.
The senators' proposals include the imposition of full repayment of public aid if a company relocates within two years, and the creation of an annual updated table of public aid to businesses by INSEE by 2027. These measures aim to ensure that public aid is used effectively and equitably in the economy, sustainable development, and culture sectors, where 84% of aid devices are currently focused. Despite the significant amount of public aid provided to businesses, the specific annual amount given to large corporations in 2023, such as Michelin, ArcelorMittal, LVMH, and Auchan, is not detailed in the provided search results and may require consultation of government budget reports or official economic reviews.
