France Suspends Fuel Tax Rise to Quell Protests
“The time for dialogue has come,” said Prime Minister Édouard Philippe, announcing several measures designed to boost purchasing power.
PARIS — French Prime Minister Édouard Philippe said Tuesday the government would suspend fuel tax hikes after a third weekend of antigovernment protests led to scenes of violence and ransacking that officials compared to the May 1968 student riots.
“The time for dialogue has come,” the French leader said, calling for an end to the ongoing protests by demonstrators in reflective safety vests — known as “gilets jaunes” — who have blocked roads and vandalized stores since Nov. 17, causing foot traffic to plummet during the crucial holiday spending season.
The protests were sparked by the fuel tax and have grown to encompass a range of demands over declining living standards, with demonstrators calling for the resignation of President Emmanuel Macron.
The government will suspend for six months the implementation of the so- called carbon tax, designed to help France switch to greener energy sources, Philippe said. It will hike the minimum wage by 3 percent, its biggest rise in more than two decades, and launch a debate into France's tax levels, the highest in Europe, he added.
“These decisions, with immediate effect, ought to bring back calm and serenity in the country. They ought to allow us to launch a real dialogue about the various concerns that have been raised over the last few weeks,” he explained.
Some 136,000 people nationwide joined the demonstrations on Saturday, which left 263 people injured, up sharply from 16 the week before, according to the Interior Ministry. Police arrested 682 people. Philippe said that while he heard the anger of the demonstrators, the government would not tolerate more chaos.
“Everyone in France has the right to protest. Freedom of expression, freedom to protest are precious rights and founding liberties of our country. But everyone in France also has the right to safety, freedom of movement and a normal life. The government does not accept the violent attacks perpetrated last Saturday against the police, national monuments, public buildings and stores,” Philippe said.
“Those who damaged those venues damaged the property of the French. French people's taxes will be used to repair and compensate for the damage. I want to be clear that we are looking for the perpetrators of these acts and they will be punished,” he added.
Finance Minister Bruno Le Maire said mass retailers have seen a 15 percent to 25 percent cumulative drop in sales as a result of the demonstrations, and tourism is beginning to feel the effect of cancellations as images of rioters are broadcast around the globe.
Department stores Galeries Lafayette, Printemps and Le Bon Marché evacuated shoppers and closed early on Saturday after violent protests spread throughout Paris. Chanel, Dior, Burberry and Givenchy are among the luxury brands whose stores have been damaged over the last two weeks.
“The impact is severe and ongoing, since we are now looking at drops in turnover ranging between 15 percent and 25 percent depending on the sector,” Le Maire said after meeting with business representatives on Monday. “Let's not underestimate the psychological impact on French people of this violence,” he added.
The minister reported that revenues for specialist retailers have plummeted by 20 percent to 40 percent since the protests began on Nov. 17. Restaurants have seen their turnover fall by 20 percent to 50 percent, and hotel reservations are down by 15 percent to 20 percent due to the “democratic crisis” gripping the nation, he said.