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Power to the people - should Europeans choose where their taxes go?

French Prime Minister Gabriel Attal gestures, in Paris, France, during the opening ceremony of the 2024 Summer Olympics. 26 July, 2024.
French Prime Minister Gabriel Attal gestures, in Paris, France, during the opening ceremony of the 2024 Summer Olympics. 26 July, 2024. Copyright Pascal Le Segretain/AP/Getty Images
Copyright Pascal Le Segretain/AP/Getty Images
By Eleanor Butler
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As France tries to find its way through political gridlock, the outgoing PM Gabriel Attal is looking for policies with cross-party support. One idea is to give more power to taxpayers.

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France's outgoing Prime Minister, Gabriel Attal, has proposed a change to national income tax in a letter entitled "action plan for the French people", according to Le Monde.

Attal, a member of the Renaissance party led by President Emmanuel Macron, has suggested that taxpayers should be able to send a portion of their contributions towards a "freely chosen mission within the state budget".

This policy, sometimes referred to as participatory budgeting, was already suggested by the socialist politician Christine Pirès Beaune last year.

In an amendment, then rejected by the presidential majority, Beaune suggested that taxpayers should be able to decide where 5% of their contributions goes.

In 2010, the idea was previously suggested by Renaissance politician Eric Woerth.

One way to unite a divided assembly?

Attal's letter was addressed to leaders of France's parliamentary groups, except those at the head of the far-right National Rally party (RN) and the far-left France Unbowed party (LFI).

Le Monde also notes that the letter excludes politicians within the group À Droite!, aligned with the RN and headed by Éric Ciotti.

Attal's proposal, dated the 12 August, claims to seek "a new path for the National Assembly" that goes beyond "conventional divisions".

At the top of his list of six priorities, Attal calls for "the restoration of our public accounts and the reinforcement of our economic sovereignty".

Letter from Gabriel Attal to the leaders of parliamentary opposition groups.

After a shock result in France's legislative elections last month, the country has been left in limbo given the failure of any party to secure an absolute majority.

With 182 seats, the New Popular Front (including the LFI) emerged with the largest share of the votes. The Ensemble coalition of centrist President Emmanuel Macron, which secured 168 seats, came in second. The RN and allies, meanwhile, bagged 143 seats.

Attal hopes that participatory budgeting could be a policy to unite legislators across political parties.

Participatory budgeting in other countries

Similar initiatives are already implemented in other countries such as Italy, for example through the "otto per mille" mechanism.

This allows Italian taxpayers to allocate 0.8% of their personal income tax towards projects of their choice, as long as they fall within certain categories.

These include initiatives relating to "cultural heritage", "natural disasters" or "assistance to refugees".

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Spaniards, meanwhile, can choose to dedicate 0.7% of their income tax to the Catholic Church or to social welfare projects run by NGOs.

In France, an indirect form of participatory budgeting already exists, where taxpayers can reduce their income or real estate tax contributions by making charitable donations.

Around €5.9bn in donations were declared to the tax authorities by individuals and companies to obtain a tax reduction in 2021.

A more direct approach to participatory budgeting is nonetheless controversial.

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Some fear that allowing the public more control over the destination of taxes undermines the authority of lawmakers to make decisions about the nation's finances.

Others point out that if taxpayers are given power over their contributions, individuals who pay more income tax will have a greater influence over government decisions.

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