PARIS, Nov.
7 (Xinhua) -- French Prime Minister Francois Fillon on Monday sketched out new
austerity plan, including accelerating pension reform and intensifying fight
against tax loopholes, in hope to reduce public deficit and secure the
country's AAA rating.
According
to Fillon's presentation, the French government plans to speed up the pension
reform by implementing the 62 retirement age in 2017, earlier from previously
scheduled 2018, to increase VAT on many goods and services between 5.5 percent
and 7 percent, and to raise corporation tax by 5 percent on companies with a
turnover above 250 million euros (343.5 million U.S. dollars) a year.
In
addition, the government would strike further against the tax loopholes with a
target to gain extra 2.6 billion euros (3.6 billion dollars).
"We
want to protect the French against the serious problems facing other European
countries," Fillion said.
Overall,
France aims to reap extra 18.6 billion euros (25.6 billion dollars) over the
next two years: 7 billion euros (9.6 billion dollars) in 2012.
In October,
the ratings agency Moody's downgraded the ratings of the biggest French banks
given their exposures to sovereign debt of Greece, Italy and Portugal.
It also
warned to put France's triple-A sovereign credibleness on negative review in
the coming months.
Both French
ministers and central bank governor have stood firm on defending the second
largest eurozone economy's credibility. Early this year, Sarkozy government has
already announced the need to collect 12 billion euros (16.5 billion dollars)
to avoid sliding back into recession by freezing public spending and reducing
tax loopholes.
Following a
near flat growth in the second quarter, France revised down growth forecast of
gross domestic product (GDP) for 2012 from 2.25 percent to 1.75 percent.
In his
presentation, Fillon indicated the lower expectation of 1 percent growth for
2012, echoing Sarkozy's estimation on Oct. 27.
France's
total accumulated debt will be higher in 2012 at 87.4 percent of the GDP mainly
due of France's contribution to bail out debt-ridden countries such as Greece,
Portugal and Ireland. Its 2011 debt rate was projected to reach 85.5
percent.
Editor: Mu Xuequan
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