While the centrist government agreed to scrap the planned fuel tax hikes behind the unrest, it has refused to reinstate the country’s controversial ISF wealth tax, a symbol of social justice. Mr Wauquiez told French business newspaper Les Echos: “What we need is a sound plan to reduce public spending, one that is implemented in tandem with a fiscal big bang.” He then claimed president Emmanuel Macron’s government must rewrite the country’s fiscal policy “from scratch“.
Mr Wauquiez added: “There are hundreds of taxes in France, and innumerable tax loopholes.
“The taxation system is illegible and unpredictable.”
A widespread “fiscal fatigue” is one of the many woes driving yellow vests’ anger, he continued.
Yellow vest protesters are, for the most part, “people who work hard but are unable to live decently from the fruits of their labour,” Mr Wauquiez said, before urging the government to “eliminate or reduce a number of taxes”.
The sweep of yellow vest protests and their wide support by citizens from across the political spectrum has badly shaken Mr Macron’s government.
Many workers in France are angry over the combination of low wages, high taxes and high unemployment that have left many people struggling to make ends meet.
The centrist administration has struggled to contain the increasingly violent, rolling street protests that started in mid-November and originally stemmed from anger over planned fuel tax hikes.
But the movement, named after the fluorescent yellow jackets all French drivers must keep in their vehicles in case of an emergency, has since morphed into a wider rebellion against Mr Macron’s liberal economic policies, which are seen as favouring the urban elite.
The government cancelled the planned increase in fuel taxes in December, but the surrender came too late and failed to quell the mounting anger at the young president, whom yellow vests consider out of touch with the problems of ordinary citizens.
The fuel tax rise was part of Mr Macron’s efforts to wean France off fossil fuels, namely diesel, in order to reduce greenhouse gases and help reverse climate change.
Its withdrawal is a harsh blow to broader efforts to curb global warming, while the unexpected policy U-turn risks denting the young leader’s reformist credentials.
Mr Macron, however, has staunchly refused to reinstate a controversial wealth tax he scrapped early into his mandate in 2017, a decision which earned him the unflattering “president of the rich” tag among his critics and that he has struggled to shake off.
The wealth tax – known as the ISF, or “impôt de solidarité sur la fortune” – was widely seen as a symbol of social justice. It has since been transformed into a property levy.
Finance Minister Bruno Le Maire, for his part, said last month France would tax digital giants at a national level if European Union states fail to reach an agreement on a tax on digital revenues for the bloc this year.
The tax on digital giants could raise up to 500 million euros in a full year, according to Mr Le Maire.
Mr Macron’s yellow vest concessions, which include a 100-euro increase for around five million minimum wage earners, the removal of a planned tax increase for cash-strapped pensioners, and tax-free overtime pay for all workers, is expected to blow a 10 billion euro (£9 billion) hole in the 2019 budget.
That in turn will push the fiscal deficit well past 2.8 per cent of GDP, breaking through the European Commission’s three percent ceiling.
Mr Le Maire told lawmakers in the Senate last month: “With the additional spending, we are going to surpass three per cent and I want every necessary measure to be taken to keep us as close as possible to … our European commitments.
“That can be done by keeping public spending under control and by (increasing) tax receipts … and by specifically asking big companies to contribute. I’m in favour.”