French Prime Minister Francois Bayrou, right, lost a no-confidence vote on Monday. Reuters
French Prime Minister Francois Bayrou, right, lost a no-confidence vote on Monday. Reuters
French Prime Minister Francois Bayrou, right, lost a no-confidence vote on Monday. Reuters
French Prime Minister Francois Bayrou, right, lost a no-confidence vote on Monday. Reuters

What next for France after the Bayrou government's collapse?


Sunniva Rose
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France's fourth prime minister in two years, Francois Bayrou, was ousted on Monday after losing a no-confidence vote, plunging the country further into political turmoil days ahead of major national strikes.

Mr Bayrou, who was appointed eight months ago, had hoped to unite politicians behind €44 billion in spending cuts aimed at reigning in national debt. Instead, opposition parties took the opportunity to topple the government, eight months after its nomination. Just 164 deputies backed the government while 364 were against.

A screen shows the result of a confidence vote. Reuters
A screen shows the result of a confidence vote. Reuters

President Emmanuel Macron is expected to move quickly to pick a replacement – probably someone from his circle of loyalists. Potential candidates include Defence Minister Sebastien Lecornu, Justice Minister Gerald Darmanin, and former Socialist prime minister Bernard Cazeneuve.

The collapse of Mr Bayrou's government comes at a critical moment as France braces for a tense September. A grassroots protest movement named “Let's block everything”, initially launched on social media during the summer, is scheduled for Wednesday. It has raised fears of a resurrection of the “gilets jaunes” movement that paralysed the country in late 2018.

Marine Le Pen, the leader of the far-right National Rally, wants snap elections. Bloomberg
Marine Le Pen, the leader of the far-right National Rally, wants snap elections. Bloomberg

Leftist movements such as France Unbowed have attempted to harness public anger fuelled by years of sluggish economic growth. Politicians such as the firebrand Jean-Luc Melenchon hope that social unrest will force Mr Macron to step down two years before the end of his mandate, paving the way for a new presidential election.

While Mr Macron resigning remains an unlikely prospect, and one that the President has repeatedly dismissed, it may become more pressing if the next government collapses shortly after it is nominated.

Reinvention?

Mr Bayrou's fate mirrors that of his predecessor, the conservative Michel Barnier, who lasted just three months in the job before becoming the shortest-serving prime minister in France's modern republic when he was toppled by a no-confidence vote – also over planned budget cuts.

In interviews, Mr Bayrou has argued that people will, in time, acknowledge with hindsight that he was right to push for massive debt cuts so as to not overly burden France's future generations.

“Our social system, which is no longer stable because of our ageing population, faces huge questions,” Mr Bayrou said in his final speech on Monday. “It's a model that needs to be reinvented.”

On Friday, Fitch is set to review France’s credit rating, which was downgraded by Moody's after the previous government collapsed last year. A repeat could force France to a lower rating category and raising the risk of forced selling of its already pressured bonds.

A number of trade unions have also announced nationwide strikes for September 18. Strikes are expected to affect the national railway service, as well as public transport in Paris and air traffic controllers.

France is bracing for social unrest that many have already compared to the gilets jaunes movement that paralysed France in late 2018. AFP
France is bracing for social unrest that many have already compared to the gilets jaunes movement that paralysed France in late 2018. AFP

Many fear that France has entered a period of chronic instability similar to that of 1958, which triggered the establishment of the Fifth Republic under the president and war hero Charles de Gaulle.

Political polarisation

“We are living at the same time a crisis of regime and a crisis of society,” the veteran political journalist and writer Alain Duhamel told the daily newspaper Le Monde in an interview. “What strikes me is the irresponsibility of politicians. The opposition does not seem to appreciate the seriousness of the economic, financial and budgetary situation.”

A number of political heavyweights, including the far-right figure Marine Le Pen, have also called for snap elections. Such a move would shift the balance of power in France's National Assembly, as Ms Le Pen's National Rally would be expected to win 33 per cent of votes in the first round, according to a recent poll by the broadcaster Public Senat.

This would probably pave the way for the far-right's 29-year old leader, Jordan Bardella, to become Prime Minister. He is the most popular choice among French voters, a recent poll ordered by the daily Le Figaro newspaper showed, ahead of the Interior Minister, Bruno Retailleau.

Adding to the political polarisation in the country, Ms Le Pen has declared that she will run in parliamentary elections – should they take place – despite being banned from office for five years following a corruption conviction in March.

Ms Le Pen's appeal trial has been scheduled for January 13 and is set to last until February 12, boosting her chances of being elected president in 2027. The three-time presidential candidate has vowed to pursue her presidential ambitions, saying she is the target of a “witch hunt”.

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

Cricket World Cup League Two

Oman, UAE, Namibia

Al Amerat, Muscat

 

Results

Oman beat UAE by five wickets

UAE beat Namibia by eight runs

 

Fixtures

Wednesday January 8 –Oman v Namibia

Thursday January 9 – Oman v UAE

Saturday January 11 – UAE v Namibia

Sunday January 12 – Oman v Namibia

Updated: September 08, 2025, 5:35 PM