France slashes budget deficit by $1.2bn
Paris, March 10, 2012
France's central budget deficit fell by 0.9 billion euros ($1.18 billion) in January from the figure 12 months earlier despite higher recorded spending, thanks to a 4G telecom frequency sale, the budget ministry said yesterday.
France and its euro zone neighbours are bound by a pact to reduce budget deficits in order to restore market confidence in their finances, and President Nicolas Sarkozy's government has embarked on an austerity programme.
Sarkozy wants to impose on big firms a financial transaction tax. Sarkozy has said that he would slap a tax on the profits of big-listed companies which would bring in up to 3 billion euros a year to help cut the public deficit.
Nevertheless, the finance ministry said recorded central state spending in January rose to 32.8 billion euros at the end of January, compared to 26.3 billion in the same period last year - but explained this as an accounting anomaly.
According to a statement, government accountants had made faster progress in record keeping than in previous years and had thus accounted for more real spending in the period in question.
In addition, government receipts over the period were up to 23.4 billion euros from 20.5 billion, partly as a result of increased business tax revenue, and partly thanks to a 2.6 billion euro mobile frequency auction.
The ministry said it was still on course to reduce the budget deficit for 2012 to 84.8 billion euros, compared to 90.8 billion last year.-TradeArabia News Service