Fuel tax rises which have led to weeks of violent protests in France have now been postponed for six months.
The move was announced in a televised address by PM Edouard Philippe, who said anyone would have “to be deaf or blind” not to hear or see the anger.
The protests have hit major cities, causing damage and disruption over the past three weekends.
The “gilets jaunes” (yellow vest) protests have now grown to reflect more widespread anger at the government.
The “yellow vests” are so called because they have taken to the streets wearing the high-visibility yellow clothing that is required to be carried in every vehicle by French law.
President Emmanuel Macron was elected last year with an overwhelming mandate for sweeping economic reform, but his popularity has fallen sharply in recent months amid accusations that he is a “president for the rich”.
Four people have died since the unrest began and the resulting violence and vandalism have been widely condemned.
Mr Philippe said that the next planned rise in the so-called carbon tax on vehicle fuel, which had been due to come in on 1 January, would be suspended for six months to allow consultations across the country to see what accompanying measures might be introduced to ease the burden for the worst-off.
He also said planned increases in gas and electricity prices this winter would be halted, and that a toughening of the rules for vehicle emissions tests would also be postponed.
It is a major climb down by the government of President Macron, who has said the measures are necessary to combat climate change and meet budget deficit reduction targets.
“This anger, you would have to be deaf and blind not to see it, nor hear it,” said Mr Philippe after meeting lawmakers from the governing party La Republique en Marche.
“The French who have donned yellow vests want taxes to drop, and work to pay. That’s also what we want. If I didn’t manage to explain it, if the ruling majority didn’t manage to convince the French, then something must change,” he added in his televised address.
Source: BBC
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