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The CRDS could be extended until 2042!

In exceptional situations, exceptional measures. While French debt will explode due to the crisis born of the Covid-19 epidemic – up to 121% of GDP at the end of the year – the executive is organizing. Bercy is thus working, according to information from Les Échos, to isolate 150 billion euros from “Covid debt”. To do this, the contribution for the reimbursement of social debt (CRDS) could be extended until 2042.

Bruno Le Maire drew the outlines of this ambitious plan this Monday, June 29, before the National Assembly. This “Covid debt” will be “reimbursed by growth, not by taxes”, assured the Minister of Economy and Finance adding that it will be “by confining it and separating it from the 100 points of the debt initial”. The Bercy tenant said that “we will adopt the same strategy as for the social debt which has been confined to the Social Debt Amortization Fund – Cades – which will be repaid by 2033”.

Extension of direct debits

Concretely, the government should thus isolate 150 billion euros of public debt, detail Les Echos. This is part of what he considers to be the direct result of the health crisis that has rocked France. A measure which is inspired by what was done last May for social debt: 136 billion euros had been transferred to Cades. A precedent that would allow the government to write off the state’s “Covid debt”. Cades could indeed welcome this new debt, unless the government creates another vehicle so as not to mix the genres.

>> Read also – Public debt: “Tax is not the solution”

Another headache for Bercy: finding a way to finance the repayment of this debt. To do this, according to information from the economic daily, the government would favor a further extension of the CRDS. This 0.5% levy on all income should disappear

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