Sarkozy aims for €11bn in extra savings by 2012

Steve Dinneen
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Nicolas Sarkozy yesterday said he will tighten France’s belt to the tune of €11bn (£9bn) next year to ensure it stays on track with deficit targets.

The budget savings announcement came after France was forced to scale back its economic growth forecasts for 2012 from 2.25 per cent to just 1.75 per cent. It has also trimmed its 2011 growth forecast from two per cent to 1.75 per cent.

Prime Minister Francois Fillon said the rich will be asked to put their hands in their pockets, with a new three per cent tax on annual revenues above €500,000 and changes to taxes on real estate capital gains.

He said: “This is a rigorous policy that will allow France to remain relaxed. Our country must stick to its commitments. It’s in the interest of all French people.”

Meanwhile, a small group of super-rich French businessmen, backed by Publicis boss Maurice Lévy and L’Oréal heiress Liliane Bettencourt, have formed a lobby group calling for the country’s wealthiest to make an “exceptional contribution” to the government’s revenues.