Jessica Fino 20 Apr 2017 05:04pm

French elections: candidates' tax and business policies

A look at the domestic and international economic policies of the main runners in a too-close-to-call French presidential election

Caption: The economic policies of the main runners in the French presidential election.

British prime minister Theresa May’s decision to hold a snap general election has dominated media this week, but just around the corner is a French presidential election that could have major economic repercussions for the rest of Europe.

Recent polls have suggested that Marine Le Pen and Emmanuel Macron are head to head, with an Elabe poll predicting that Macron will receive 24% and Le Pen 23% of the votes in the first run this Sunday.

However, with one-third of voters still undecided, any two of the leading four candidates could go ahead to the second round.

But what about the candidates themselves? We decided to examine their plans on tax, business and the economy.

Marine le Pen, National Front

Le Pen says she would hold an EU referendum after a six-month period of talks in a bid to negotiate France’s position, where she plans to reject the euro.

She has also proposed a 3% tax on imports and the rejection of international trade treaties.

Her party's manifesto, unveiled in February, included plans to cut taxes and increase welfare benefits.

She pledged to cut income tax on the three lowest revenue bands by 10%, cut the retirement age to 60 from the current 62, and allow each parent to give each of their children 100,000 euros tax-free every five years.

The central tenet of Le Pen’s campaign has, unsurprisingly, been anti-immigration. She pledged to cut migration to a net 10,000 people per year, limit asylum requests made abroad and make it harder to become a French citizen.

If elected, she also aims to give priority to French nationals over foreigners in matters such as jobs, housing or education. Companies who hire foreigners would be subject to an extra tax of 10%, she suggested.

The National Front leader told the Le Monde newspaper in February that she intended to "apply national priority on employment through an additional tax on all new contracts for foreign employees".

“The income from that would pay for unemployment benefit,” she added.

Just one week before the first vote, Le Pen said in Paris she would suspend all immigration in an attempt to “stop this frenzy, this uncontrolled situation that is dragging us down".

She has survived accusations that she refused to repay €300,000 (£251,000) of EU funds that a European Parliament investigation claimed she misused to pay her staff.

Emmanuel Macron, En Marche!

The fresh-faced independent, who is just 39, pledged to keep the country’s budget deficit below 3% of GDP, reduce unemployment to 7% and cut corporate tax from 33% to 25%.

The former investment banker also said he would scrap some social welfare levies to low-wage earners and invest €50bn in the public sector.

Contrasting with Le Pen, Macron suggests a much softer immigration policy, with asylum requests being processed within six months from applications and is against the ban of Muslim veil for university students, which has been suggested by other candidates.

A Macron government would also give money to companies that hire people from low-income neighbourhoods.

The former banker has said he would ban mobile phone use in schools for students aged under 15 and reimburse the full cost of glasses, dentures and hearing devices.

He was previously a member of the Socialist Party, but left and set-up the independent and centrist En Marche! party.

François Fillon, Republican Party

Until recently, Fillon was favourite to win until he became embroiled in a scandal over accusations that he paid his wife with public funds for work she didn’t carry out.

Despite pressure and being put under investigation, he has decided to carry on his campaign.

In his manifesto, Fillon pledged to scrap the wealth tax, cut public sector jobs and the 35-hour work week.

If elected, he plans to cut public sector jobs by up to 600,000, in a bid to cut public spending and fund €40bn in tax breaks for companies.

The former prime minister has also said he plans to lift EU sanctions on Russia and has proposed the return of British border controls to the UK. Currently, the controls are made in Calais.

He would also defend the country’s “Christian values”, promising to remove some gay adoption rights and ban medically assisted procreation.

Jean-Luc Mélenchon, Parti de Gauche

Mélenchon has grown his popularity through social media, and has even included virtual appearances at rallies via hologram.

Unlike the majority of his rivals, Mélenchon has pledged to increase public spending by €173bn.

A recent pledge of a 90% tax on salaries above €400,000 has also been making waves.

Moreover, he has suggested an increase in the minimum wage by 16% and a limit on executive pay.

Family allowances should also be replaced by a fixed tax credit of €1,000, according to the leftist.

His international policies include a “democratic reconstruction” of European treaties or even withdrawal from the EU, as well as leaving NATO, the World Trade Organisation, the International Monetary Fund and the World Bank, halting negotiations on a free-trade agreement with the US and creating a closer relationship with Russia.

Benoît Hamon, Socialist Party

Despite not being one of the favourites on the race, Hamon has proposed some of the most striking economic policies, including the taxing of robots, which would partly subsidise a universal basic income of €750 a month.

He believes businesses should be held accountable and be forced to pay compensation for staff who are “burned out”.

Companies would also be incentivised to introduce four-day weeks, sabbaticals or part-time hours. The standard working week would also be cut by three hours.

Hamon, who beat the former French prime Manuel Valls during the party nomination, has also proposed the cancelation of the debt owed by the EU’s poorest countries to the union.