France Giving Businesses $25B Tax Break
PARIS (AP) -- France will give businesses €20 billion ($25 billion) in tax credits over three years in the hopes of sparking innovation and lowering the unemployment rate.
Prime Minister Jean-Marc Ayrault announced the measure Tuesday, a day after a government-requested report suggested just such a tax break to boost the ailing economy.
But the report said the break needed to be given over one or two years to have the maximum effect.
Ayrault said Tuesday that the credit goes into effect next year, when €10 billion will be handed back to companies.
The government will pay for that €10 billion on a slower schedule. Half of it will come from spending cuts between 2014 and 2015. The rest will come from taxes, including a hike to the sales taxes in 2014.