Hi Sai,
I changed first tags to
body{
font-size: 120%;
font-family: Verdana, Arial, Helvetica, sans-serif;
letter-spacing:0.02em;
}
and it works for my site (all fonts are 20% larger). Could this be a problem of your browser default font? Another reason could be that in theme config.php you have font size defined in some css file after styles_font.css like in styles_color. Check in config.php line
$THEME->sheets = array('styles_layout', 'styles_fonts', 'styles_color');
If you liked previous font sizes you could also copy Standard theme style sheet to your new theme styles_fonts.css ...