France narrows its deficit in 2025, driven by tax revenues, amid an uncertain environment.
France’s public deficit stood at 5.1% of gross domestic product (GDP) in 2025, according to initial estimates published by INSEE (National Institute of Statistics and Economic Studies) on Friday, March 27, 2026. This level is below the government’s forecast of 5.4%, and marks an improvement from 2024, when it reached 5.8% of GDP. It is the first decline in the deficit in several years, in a tight budgetary context.
This improvement is mainly based on an increase in public revenues, up 3.9%, driven notably by higher income and wealth taxes, according to INSEE’s report. At the same time, growth in public spending slowed to 2.5%, against around 4% the previous year, reflecting an effort to curb the budget.
The Prime Minister, Sébastien Lecornu, hailed these results by stating that “the method is paying.” This trajectory fits within a strategy to gradually restore public finances without resorting to large-scale and generalized support measures, particularly in the face of rising energy prices.
The government favors targeted aid, notably for certain sectors such as transport or agriculture, while offsetting these expenditures with savings elsewhere.
This dynamic has also led to a slight decrease in public debt, which stood at 115.6% of GDP at the end of 2025, i.e., about 3.46 trillion euros. This decline remains limited and comes after several years of strong increases linked to successive crises, notably the Covid-19 pandemic and energy shocks.
Despite this improvement, France’s budgetary situation remains fragile. The deficit remains well above the 3% of GDP threshold set by European rules, which the government aims to reach by 2029. In the short term, the executive targets a deficit around 5% in 2026.
Sébastien Lecornu also reaffirmed this objective by stating: “We continue—with caution—to drop below 5% in 2026.” He nonetheless acknowledged that “geopolitics will play a role,” highlighting uncertainties linked notably to the conflict in the Middle East.
