To reduce the country’s deficit next year and to preserve its AAA rating, the French government is considering the idea of increasing the value-added tax (VAT) in France to either 7% or 9% in certain targeted areas from prevailing 5.5% rate and at the same time curbing spending.
According to recent reports, it is expected that increasing the 7% VAT rate will result into an increase in the government revenue around EUR1.5bn for work carried out on certain labour-intensive services including the catering industry, while increasing the rate to 9% would serve to double this figure.
