Telle est la vie......
French Prime Minister Jean-Marc Ayrault has said that nine out of 10 citizens will not see their income taxes rise in the new budget.
He has confirmed that there is to be a new 75% tax rate for people earning more than 1m euros (£800,000; $1.3m) a year.
He has not yet detailed how much taxes will rise for the rest of the top 10%.
It is one of the key policies in what he called "a courageous, responsible budget - a budget of conquest".
The government's priorities were young people, training and cutting 10bn euros from its spending, he said. This would demand an effort but would be fair, he added.'Fighting budget'
Official figures on Friday showed that French public debt had hit 91% of GDP between April and June this year.
Francois Hollande came to power criticising the policy of austerity-first. Growth would be the priority. Now he is seeking to dampen expectations.
There was confirmation earlier that there has been no growth for three consecutive quarters. France is stagnating. Unemployment has risen above three million and the president's approval ratings are falling.
This budget, he said, would be France's toughest single belt-tightening in 30 years. With public debt at a post-war record of 91% of the economy, the budget is being seen as a marker of what kind of reform we are likely to see.
Mr Hollande will be focusing on higher taxes, instead of the more painful spending cuts we have seen in the likes of Greece and Spain, in spite of the warnings from a growing number of analysts that the level of state expenditure is no longer sustainable.
For the moment, interest levels are historically low as investors look for safe havens away from Spain and Italy, but if the markets sense this government is not serious about reform, that could quickly change.
It was 89.3% at the end of March, which was still well above the eurozone limit of 60%.
Mr Ayrault pointed out that debt had grown by 30% of GDP in the past five years.
"This is a fighting budget to restore the country to health," he said.
"This is a fighting budget to fight a debt that doesn't stop rising and whose bill is being footed by the French and by future generations."
He also said that the budget would encourage small and medium businesses and that taking risks would also be encouraged.
In its first budget, the Socialist government repeated its promise to cut the annual deficit to the eurozone limit of 3% of GDP next year.
The deficit this year is expected to be 83.6bn euros, which is 4.5% of GDP.
Mr Ayrault said that France was strong when it set itself ambitious targets.
But some analysts said that the targets were too ambitious because they assumed too much growth for the coming years.
They said that tax increases and spending cuts would make it difficult to achieve the 0.8% growth in 2013 and 2% growth in 2014 that are predicted by the budget.
"I have a hard time seeing... how we're going to find the necessary growth in 2013 and afterwards," said Philippe Waechter, economist at Natixis Asset Management.
"So far we have a lot of numbers and not the story."'Bad choice'
The budget has been controversial, with some top earners threatening to leave the country as a result of the planned tax rises.
President Francois Hollande was elected on a platform of abandoning austerity and encouraging growth and his popularity in France has suffered as a result of the need to cut debt.
Opposition parties have argued that more savings should have been found from cutting public spending so fewer tax rises would have been necessary.
"Never have households and companies been subjected to such a fiscal shock," said Gilles Carrez, conservative chairman of the French parliament's finance committee.
"It's a very bad choice. More savings should have been made."
The national secretary of the French Communist party, Pierre Laurent, was also critical of the plans.
"We already know that the goal of 3% isn't tenable for a very basic reason: there isn't enough basic growth to get there," he said.
"The budget will rather worsen the situation, because we know that the current austerity recipe is pushing the economy into a recession."
BBC
