What is the best way to help households in France: Taxing companies or increasing the fiscal deficit?

The French government has decided to boost household income ( by cut ting direct taxes , index ing pensions, increasing the low est pensions, which comes on top of the increase in the activity bonus, reducing social contributions, abolishing the residence tax, and providing tax exemption for overtime). The choice is therefore now between: Taxing companies (for example by reducing tax deductibility ) to finance transfer payments to households; Increasing the fiscal deficit by taking advantage of the very low level of interest rates. In reality, neither of these two choices is good: The French corporate tax rate is very high, French companies’ profitability is still low, their capacity to self-finance their investments is lower than in other euro-zone countries; their cost competitiveness is still poor . So it is not desirable to tax companies; Even though interest rates are low, increasing the fiscal deficit to finance transfer payments to households and not public spending that boosts long-term growth is not desirable either. In reality, it is still too early to stimulate consumption given the supply side problems that still remain .