Paris Just Got Cheaper

Taxes are going up in most parts of the world as governments struggle to pay for the financial crisis, but one place they are going down is in French restaurants. Sales tax on restaurants and cafes from Paris to Cannes will be falling from 19.6 percent to 5.5 percent as of July 1st, thanks to a new national VAT cut.

It's only appropriate that the French, who still spend more time eating and sleeping than any other country (check out stats on that from the OECD's new Society at a Glance survey), would consider encouraging more frequent trips to restaurants as a key part of their national stimulus efforts. Bistros and cafes in particular have been hit hard since the downturn last year, with 3,000 plus closing their doors in 2008 (a new ban on smoking didn't help matters).

Economy minister Christine Lagarde is also hoping that the cut will allow France to "conserve and improve its culinary reputation," and indeed, restaurant owners have promised to go on a hiring spree to improve service. Unfortunately the new tax cut won't apply to alcohol (government ministers don't want to encourage those still unemployed to cry in their bordeaux). But it will make the average cafe meal a whole lot cheaper for lots of summer tourists -- just remember not to order any Freedom Fries.