July 4, 2017 / 2:06 PM / 2 months ago

French PM says most tax cut measures will take effect in 2019

French Prime Minister Edouard Philippe delivers a speech on the government general policies plans at the National Assembly in Paris, France, July 4, 2017.Philippe Wojazer

PARIS (Reuters) - French Prime Minister Edouard Philippe said on Tuesday that the government's plan to convert the previous administration's flagship "CICE" tax credit for companies into a permanent reduction in payroll charges, will only take effect in 2019.

President Emmanuel Macron initially planned to do the switch - which would cost public finances about 20 billion euros ($22.7 billion)- in 2018, but a public audit ordered by the government revealed France risked overshooting its budget deficit target this year and next year as well.

Philippe confirmed in an address to lawmakers that the government would exempt any non-property related wealth from the country's wealth tax, a measure which will take effect in 2019. It will gradually cut the corporate tax level to 25 percent by 2022 from 33.33 percent today.

France will also introduce a flat tax of about 30 percent on income drawn from savings, from the current level of up to 50 percent, Philippe said.

Reporting by Michel Rose and Ingrid Melander; Editing by Sudip Kar-Gupta

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