The French government is working on new changes to taxes and benefits, aiming to save 2 billion euros from costs related to sick leave. These plans are part of the draft budget and financing law for the Social Security system for 2027, which was introduced on October 1st. Minister of Labor and Solidarity Jean-Pierre Farandou is preparing to discuss these changes with groups representing workers and employers, hoping to reduce by 1 billion euros the amount spent on health insurance for daily allowances in 2027. The government wants to make the tax treatment of daily allowances more similar to regular income from work, following the idea that income from sick leave should be taxed the same as regular wages. Currently, daily allowances given by the Social Security system during sick leave are fully taxable, just like regular salaries, except for people with long-term illnesses (ALD), such as certain cancers or multiple sclerosis, who are completely exempt from income tax. Those who receive daily allowances due to a work accident or occupational disease are taxed at 50%. The government is focusing on reducing the exemptions for these specific cases, not the entire amount of daily allowances, which are already taxed. Several changes have already been put into place through official decrees. Since September 1st, the length of primary prescribed sick leaves has been limited to one month, as decided by lawmakers in the 2026 Social Security budget. Starting October 15th, the maximum duration of sick leaves for certain patients, like those with mild depression or musculoskeletal disorders, will be cut from three years to one year. These conditions account for two-thirds of long-term sick leaves, and the government expects to save "several hundred million euros" through these changes. Another proposed decree aims to lower the maximum daily allowance for sick leaves for people who suffered work accidents or occupational diseases to 1.8 times the minimum wage, down from more than 3 times currently. In spring 2025, the cap on daily allowances for "classic" sick leaves was already reduced to 1.4 times the minimum wage, down from 1.8 previously. Social Security expenses for sick leaves have risen sharply in recent years. In 2025, the total cost reached 17.9 billion euros, with 12.1 billion euros for classic sick leaves and 5.8 billion euros for work accidents and occupational diseases. Minister of Health Stéphanie Rist announced the government's goal of nearly halving the Social Security deficit by 2027, reducing it to 12.7 billion euros from 22.6 billion this year. Significant efforts in the health sector are expected to bring the deficit down to 7.8 billion euros in 2026, compared to 12.5 billion euros in 2026.