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France's 75% 'millionaire tax' to become law - CNN Money

Posted by on Dec. 30, 2013 at 9:59 AM
  • 16 Replies

 

France's 75% 'millionaire tax' to become law

By Alanna Petroff  @AlannaPetroff December 30, 2013: 9:44 AM ET

 
millionaire tax hollande

French President François Hollande had been pushing for a 75% tax on the super-rich since his 2012 presidential campaign

LONDON (CNNMoney)

France's controversial "millionaire tax" is set to become law, allowing the government to levy a 75% tax on companies that pay salaries in excess of €1 million.

The tax was approved by France's constitutional council on Sunday after an earlier version was deemed unconstitutional last year.

President François Hollande introduced the tax as a way to force the rich to help France shrink its massive budget deficit and support the sagging economy. It had originally been created as a tax on individuals, but was eventually shifted to a tax on companies paying high annual salaries.

Related: Another 'annus horribilis' for Hollande?

According to the constitutional council, employers must pay the levy on salaries exceeding €1 million ($1.4 million) a year. The tax will apply for two years -- 2013 and 2014 -- and will not be allowed to surpass 5% of a company's annual revenue.

Hollande has said the new tax is "symbolic" and designed to make a political statement about economic fairness. The tax is not ultimately expected to be a big money-maker, with the French government estimating the tax will affect roughly 470 companies.

"This tax was born in the heat of Hollande's [2012] presidential campaign," said James Shields, a professor of French politics at Aston University in the U.K. "It's only a tax for two years. It's temporary. So yes, this is highly symbolic."

France's Presidential wine up for auction

The tax proposals prompted a severe backlash from high-profile business people, movie stars and soccer clubs.

Earlier this year, French soccer clubs had threatened to boycott a number of matches after learning they would not be exempt from the tax, though the boycotts were later called off.

The initial tax proposal also prompted famous French actor Gerard Depardieu to take up Russian citizenship to protest against the tax.

--CNN's Lilia Blaise and Sandrine Amiel in Paris contributed to this report. To top of page



First Published: December 30, 2013: 8:07 AM ET
by on Dec. 30, 2013 at 9:59 AM
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Replies (1-10):
Sekirei
by Nari Trickster on Dec. 30, 2013 at 10:18 AM

wow

PinkButterfly66
by Platinum Member on Dec. 30, 2013 at 10:24 AM
1 mom liked this

The federal income tax rate in the US for income $200,000 and above was 70%.  

stringtheory
by Platinum Member on Dec. 30, 2013 at 10:27 AM
Was? I don't doubt it, but when?

Quoting PinkButterfly66:

The federal income tax rate in the US for income $200,000 and above was 70%.  

momtoscott
by on Dec. 30, 2013 at 10:56 AM

From the 1930s to the very early 80s, the marginal tax rates were quite high--they applied to income above a certain level and not the entire income.  This included the economic/job creation boom periods of the 50s and 60s that so many people seem to want to return to.  And by quite high, I mean oftentimes they were in the 90% range.   (according to a quick Google search) 

Quoting stringtheory: Was? I don't doubt it, but when?

Quoting PinkButterfly66:

The federal income tax rate in the US for income $200,000 and above was 70%.  


PinkButterfly66
by Platinum Member on Dec. 30, 2013 at 11:23 AM

Sorry, from 1965 to 1981.

http://taxfoundation.org/article/us-federal-individual-income-tax-rates-history-1913-2013-nominal-and-inflation-adjusted-brackets

Quoting stringtheory: Was? I don't doubt it, but when?

Quoting PinkButterfly66:

The federal income tax rate in the US for income $200,000 and above was 70%.  



yourspecialkid
by on Dec. 30, 2013 at 11:31 AM
1 mom liked this

 Hmm, I see this as an opportunity for some countries to woo away some big companies from France.  There is no way I would stay there as a business owner.

 

cjsbmom
by Lois Lane on Dec. 30, 2013 at 11:31 AM

Actually, it's not that out of line. As someone else mentioned, the US had a similar policy at one time. We need to have it again. Maybe not as high as 75%, but maybe around 45-50%.

tanyainmizzou
by on Dec. 30, 2013 at 11:35 AM
we also didn't have welfare as we know it. So if you want to back to the higher rates, then we need to reduced the spending of the government as well

Very few people actually paid the given tax rate. Loopholes galore.

Quoting cjsbmom:

Actually, it's not that out of line. As someone else mentioned, the US had a similar policy at one time. We need to have it again. Maybe not as high as 75%, but maybe around 45-50%.

furbabymum
by on Dec. 30, 2013 at 11:40 AM
1 mom liked this

 So pay them 900k and then give them a really big Christmas gift. Problem solved without paying the tax. We all know people are doing this now anyway.

cjsbmom
by Lois Lane on Dec. 30, 2013 at 12:05 PM

Our entire tax code needs to be rewritten. Too many loopholes, on that we can agree. 

And I have no problem with reducing government spending, so long as we're properly stimulating the economy and job growth so that people have employment options. 

Quoting tanyainmizzou: we also didn't have welfare as we know it. So if you want to back to the higher rates, then we need to reduced the spending of the government as well

Very few people actually paid the given tax rate. Loopholes galore.

Quoting cjsbmom:

Actually, it's not that out of line. As someone else mentioned, the US had a similar policy at one time. We need to have it again. Maybe not as high as 75%, but maybe around 45-50%.


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