• The New Popular Front Alliance has proposed a significant tax-and-spend economic policy

The surprise victory of the New Popular Front (NFP) in the French elections has sparked concern among the country’s wealthy citizens, as the far-left coalition plans to introduce a shocking 90 percent income tax on high-income earners.

Even before the election, financial advisors reported a huge influx of inquiries related to Emmanuel Macron’s decision to call early elections has caused wealthy French citizens to consider moving to fiscally more advantageous territories such as Italy, historic tax haven Switzerland and Spain.

But the NFP’s victory over Macron’s centrists and the far-right National Rally (RN) this Sunday forced French elites to think seriously about what their future will look like, given the very real prospect of drastic economic policies based on tax and spend.

The far-left coalition is planning a massive spending spree that will see a significant increase in the minimum wage and public sector salaries, a reduction in the retirement age from 64 to 60 and a freeze on the prices of basic goods, which it says will cost around 150 billion euros over three years.

Macron’s camp warned, however, that it could cost up to 300 billion euros and would involve the elimination of tax breaks and loans for companies, as well as an increase in income tax.

Ministers also warned against such extravagant spending, given that France is already struggling with a budget deficit of 5.5% of GDP.

“People are worried about the wealth tax, the end of the flat tax and potential higher taxation of wages, as well as a general climate that is not conducive to entrepreneurship,” said Vincent Lazimi, a partner at Paris law firm Jeantet, in a commentary ahead of the snap election.

Gregory Soudjoukdjian, a Paris-based financial adviser, told the FT after a phone call with Macron about the election: “I’m not sure I’ve ever had so many calls since the beginning of my career… Our high-net-worth clients are asking themselves a lot of questions.

“The most common question we get is whether money is safe in France,” he added.

The concerns of wealthy French people were raised when Finance Minister declared that the country faces an “immediate financial crisis” after the government reached an impasse following the NFP’s narrow victory.

Bruno Le Maire celebrated the defeat of the far-right RN, whose centrist supporters of Macron had feared would win a majority, but warned that the warring parties must reach an agreement and form a coalition as soon as possible.

He also criticized the NFP’s economic policy, writing: “The most immediate risk is the financial crisis and economic recession in France.”

“The implementation of the destructive program of the New Popular Front would destroy the results of the policies we have pursued for seven years…

“This bill is excessive, ineffective and outdated. Its legitimacy is weak and circumstantial. It must not be used,” he concluded.

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Contrary to the predictions of political pundits, French polls and the world media, the New Popular Front (NFP) coalition – led by Jean-Luc Mélenchon and his France Indomitable (LFI) party – came out on top on Sunday, winning 182 seats in the French National Assembly.

This gave them a narrow lead over President Macron’s centrist Together coalition with 168, while the far-right National Rally (RN) came third with just 143 seats, despite having led convincingly in the first round of voting just a week earlier.

This means that the vast majority of seats in parliament are now split roughly evenly between three factions, each of which has completely different views on the future of France and has no interest in forming a coalition.

Mélenchon, a fixture on the French left and controversial politician who has been dubbed the “French Jeremy Corbyn”, said the NFP needed to take the reins so it could start implementing its policies.

“The president must invite the New Popular Front to take power,” he said, describing the election results as a devastating indictment against Macron and his centrist party.

But his hopes of personally shifting France sharply to the left appear doomed, as Macron’s party members have ruled out forming a coalition with someone they see as a tax-and-spend and pro-Gaza figure who is seen in France as a radical anti-Semite.

Former Prime Minister Edouard Philippe, who is seen as a possible successor to Macron in 2027, has said any potential coalition government “cannot be the work of one man” and has dismissed any prospect of cooperation with Mélenchon’s far-left LFI party or the far-right RN.

“Our country’s credibility could be damaged and centrist political forces must uncompromisingly reach an agreement to stabilize the political situation – but without France Unbowed and RN,” he said.

Even leading members of Mélenchon’s alliance have admitted they do not think he is the right person for the job.

Socialist leader Olivier Faure said Mélenchon “is the most controversial figure in the NFP”, while a Green Party MP, who asked not to be named, said bluntly: “Mélenchon is the problem”.

With French political factions still at odds and no stable coalition in sight, Macron is trying to take advantage of the chaos.

Yesterday the president refused resignation of his protégé Prime Minister Gabriel Attal and ordered him to remain in office while the government is in limbo and can no longer oversee the day-to-day running of the country.

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Macron hopes that Attala’s stay in office will show his centrist Together alliance to be a stabilizing force and that the prime minister will help maintain some political continuity as Paris prepares to host the Olympic Games later this month.

The president did not, however, provide any further details about his next actions.

Amid rising tensions between the left and the Elysee Palace, LFI president Manuel Bompard suggested Macron was trying to go against the will of the people by keeping Attal.

He called on Macron to “respect” the election result, adding: “There is no question of Gabriel Attal as prime minister contributing to the loss of votes cast by the French people.”

Macron’s supporters have a completely different opinion on the elections, which they believe ended inconclusively.

Gerald Darmanin, the French Interior Minister, stated that “nobody won” and said that both Rally and the NPF “lost”.

Sylvain Maillard, an MEP from Macron’s group, said the search for a new prime minister could take “several weeks”.

“The French have elected a parliament made up of three blocs of roughly equal size,” he said, adding that the centrist bloc would be open to forming a government with other MPs, except those belonging to Marine Le Pen’s RN or Mélenchon’s LFI.

Macron’s office simply said he would “wait for the new National Assembly to organize itself” before deciding on a new government.

There is no hard and fast timetable for when Macron must appoint a prime minister, nor any rule that says he must choose someone from the largest party or bloc in parliament, but continued political paralysis would be a disaster for the country.

Under the French constitution, he continues to exercise authority over foreign policy, European affairs and defence, and is also responsible for negotiating and ratifying international treaties.

The president is also commander-in-chief of the country’s armed forces and has the authority to possess nuclear weapons.