Thierry Breton, France's finance minister, is proposing to give all 34m French taxpayers a year-long income tax holiday in 2008 during his planned switchover to income tax deduction by employers. Although the proposal could fall with the government in next year's presidential election, the opposition Socialists have also proposed a shift to income tax deduction by employers.

In an interview with Les Echos, the FT's French sister newspaper, Mr Breton proposes to switch to income tax deduction by employers on January 1 2009, following most other countries of the Organisation for Economic Co-operation and Development.