France Sets 'Super Tax' Rate of 75 Percent

(Newsroom America) -- The Socialist government of French President Francois Hollande introduced a "super tax" on businesses and the rich in a 2013 budget unveiled on Friday, in a bid to demonstrate that Paris has the will to close a yawning budget gap.

The package is aimed at raising some 30 billion euros ($39 billion) for government coffers "with a goal of narrowing the deficit to 3.0 percent of national output next year from 4.5 percent this year," Reuters reported. The measure is France's most stringent budget-tightening policy in years, said reports.

The measure is raising concerns among some economists, however, who say that sustained high unemployment and data pointing to economic stagnation could make it difficult to reach fiscal goals.

Also, pro-reformists were disappointed that the French budget merely freezes high public spending without taking budget-cutting measures like those adopted by Spain earlier this month in a bid to avoid conditions of an international bailout.

"This is a fighting budget to get the country back on the rails," said Prime Minister Jean-Marc Ayrault, according to Reuters, who added that a 0.8 percent growth target was both "realistic and ambitious."

"It is a budget which aims to bring back confidence and to break this spiral of debt that gets bigger and bigger," he said.

Public debt in France is at a postwar high of 91 percent, making the budget vital to France's economic future and credibility within the eurozone.

The government said the budget was the first in a series of steps to bring its deficit down to 0.3 percent of GDP by 2017, said Reuters.

© 2012 Newsroom America.

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