In its first major raft of economic measures since Francois Hollande was elected president in May promising to avoid the painful austerity seen elsewhere in Europe, the government targeted companies and the rich with tax hikes. An extraordinary levy of €2.3bn (£1.8bn) on wealthy households and €1.1bn in one-off taxes on large banks and energy firms were central parts of an amended 2012 budget presented to parliament. The law, which also includes increases in taxes on stock options and dividends and the scrapping of tax exemptions on overtime, should easily win parliamentary approval before a July 31 deadline, given the Socialists' comfortable majority. Hollande says the rich must pay their share as France battles to cut its public deficit from 5.2pc of GDP last year to an EU limit of 3pc in 2013 despite a stagnant economy and rising debt. "We are in an extremely difficult economic and financial situation," Finance Minister Pierre Moscovici told a news conference. "In 2012 and 2013, the effort will be particularly large. The wealthiest households and big companies will have to contribute."
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