Places to eat out in France have until now been suffering badly with less customers and less sales due to the economic crisis and because of a smoking ban that was brought in last year.
It is believed that the new tax cuts is going to cost the French economy over 2.3bn euros ($3.3bn; £2bn).
French restaurant and cafe owners have agreed to create an extra 40,000 job positions in the next two years, with half of the new jobs being reserved for trainees.
French Economy Minister Christine Lagarde explained that the new deal was "based on confidence and the responsibility that restaurants are assuming in price, employment and the quality of service".
The minister also said that restaurants would be monitored to make sure that those which advertise reductions do actually make them.
