The French government will propose introducing a “golden rule” in the 2027 budget to redistribute any surplus value-added tax generated by rising fuel prices, the prime minister’s office said, confirming an earlier report.
Under the plan, if fuel prices were to climb further and produce an excess of VAT revenue, “the VAT increase will be neutralized and returned to the French at the pump,” Matignon said, without specifying the mechanism for now.
Zero Profit for the State
The government will ask lawmakers to adopt the rule during parliamentary scrutiny of the 2027 finance bill. The aim is to guarantee that “there will be no gain for the public accounts,” enshrining a principle of “zero profit” for the state.
Matignon stressed that the government is not benefiting from higher fuel prices. It currently estimates tax receipts at “minus 407 million euros” since the start of the war in the Middle East, “compared with the same period in 2025.”
That result stems in part from higher VAT receipts that fail to offset a sharp drop in revenue from the excise duty on petroleum products, linked to lower volumes of fuel sold.
“The state has therefore in no way profited from price movements to date,” Matignon said.
Measures to Be Unveiled
The government is set to announce several measures following a press conference at the finance ministry. Some will target the general public, particularly those who work and drive the most kilometers.
Diesel averaged 2.39 euros per liter on Tuesday morning after exceeding 2.40 euros over the weekend, as pump prices continue to weigh on households and businesses.
