French Constitutional Court Approves 75% Tax On High Earners

Tyler Durden's picture

Almost a year ago, the French constitutional court ruled against Francois Hollande's triumphal blast into socialist wealth redistribution, with his proposed 75% tax rate on high earners, and so indefinitely delayed the exodus of the bulk of French high earners (even if some, like Obelix, aka Gerard Depardieu, promptly made their way to the country that has become the land of solace for all oppressed people everywhere, Russia) into more tax-hospitable  climes. That delay is now over, when earlier today the same court approved a 75% tax on all those earning over €1 million. The proposal passed after the government modified it to make employers liable for the 75% tax. As BBC reports, the levy will last two years, affecting income earned this year and in 2014.

Bloomberg has the details of the tax hike:

Under Hollande’s proposal, companies will have to pay a 50 percent duty on wages above 1 million euros ($1.4 million). In combination with other taxes and social charges, the rate will amount to 75 percent of salaries above the threshold, the court wrote in a decision published today.

 

“The companies that pay out remuneration above 1 million euros will, as expected, be called upon for an effort of solidarity on remuneration paid in 2013 and 2014,” the Economy Ministry said in an e-mailed statement.

 

Hollande, who once said he “didn’t like” the rich, announced the 75 percent tax in February 2012 as part of his presidential campaign to appeal to his Socialist base. It has become a symbol of his government’s record-high taxation rate.

And with the tax passage, the preparations for an exodus by all high earnings begin, first among the local football teams. BBC reports:

Football clubs in France went on strike earlier this year over the issue, saying many of France's clubs are financially fragile and say the plans could spark an exodus of top players who are paid huge salaries.

 

The Qatari-owned Paris Saint-Germain has more than 10 players whose pay exceeds 1m euros, including the Swedish striker Zlatan Ibrahimovic.

 

There has also been a chorus of protest from businesses and wealthy individuals who have condemned the tax - including film star Gerard Depardieu, who left the country in protest.

 

Polls suggest a large majority in France back the temporary tax.

 

Unlike many other countries in Europe, France aims to bring down its huge public deficit by raising taxes as well as some spending cuts. The highest tax rate in the UK is 45% and is applied to individuals.

While the numerous unintended consequences of this shock and awe tax hike will be amusing to watch in real time as this move will almost certainly be the long-awaited catalyst to push France into its long-predicted recession (to the benefit of countries like Belgium where the French uber-rich are already relocating to), one wonders if the drop in the value of French ultra-high end real estate will be offset by the soaring valuations of London's already "beyond housing bubble" home prices, and just what the local response will be now that domestic real estate is even more inaccessible to anyone but the wealthiest global oligarchs and billionaires (aside from the capital gains tax of course, which as we wrote previously, is about to be launched first in London, and then everywhere else).

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JustPrintMoreDuh's picture

If you like your earnings, you CANT keep them.

Popo's picture

Capital controls in 5... 4... 3...

Beam Me Up Scotty's picture

Just take it all. Then everyone can retire.

remain calm's picture

This movie will be coming to tax collector near you soon.

fonestar's picture

Tax them all and let God sort them out.  Keep taxing, tax people everywhere 110% of their earnings if that is what it takes to make them realize they need something like Bitcoin, out of reach of government and untaxable.

PR Guy's picture

 

 

here's one French man with a problem

 

http://www.youtube.com/watch?v=39X4sXc0Ubc

 

DIgnified's picture

Here is another: http://geirsmith.wikidot.com/

He' s hilarious. I mess with him at BIN. Absolutely insane. He calls me 'O-bot antichrist'... it's a thing we have.

kaiserhoff's picture

Exit Parisian millionaires, stage right.

Skateboarder's picture

Sorry fone, adoption of bitcoin outside of the nerd circle is going to be very unlikely.

fonestar's picture

Well in that case the "nerds" will grow exceedingly rich.  Except that is not the case, Bitcoin is already spreading in use and most users will never have any clue of how it works.  Just like how they had no clue how the Federal Reserve prints money.

logicalman's picture

If they can't get your money, they'll come for you instead.

BitCoin will be of little assistance at that point.

Governments have pretty much monolpolized violence or the threat thereof.

By the way, given you seem to be a bit of an evangelist, why not start up the Church of Bitcoin?

Hash tags in the collection plate and all that.

fonestar's picture

It's virtually impossible to tie Bitcoin users to Bitcoin addresses.  Unless you want to get into some stupid argument about a secret government quantum computer that is maintaining an exponentially growing database of addresses.

Skateboarder's picture

Pattern matching your IPs, proxied or not, is very easy.

fonestar's picture

What are you talking about?  There's no way to associate users of Bitcoin with new Bitcoin addresses.

logicalman's picture

If you are denied access to a computer you are fucked - simple as that

Blame Crash's picture

Why would the government need your pathetic bitcoins when they can have you by the throat instead?

Mae Kadoodie's picture

If we like your 75% then we can keep your 75%.

silvermail's picture

Thus, France is shooting itself in the foot? No, in the head!

zerozulu's picture

Take 100% and hang them all.

 

French revolution II

Harbanger's picture

In fairness you should only hang 75%.

RafterManFMJ's picture

What does the Frenchman say?

 

Le Moo! Le baa! Le belement!

mvsjcl's picture

"If you like your earnings, you CANT keep them."

But if you like your capital gains, YOU CAN!

TheLoveArtist's picture

The Rich never pay taxes anyways LOL, this is just for the media and middle class who is next to get their tax rates jacked up.  Unlike the uber rich who reside primarily in Monacco etc and use shell companies, the middle class rabbit is stuck in the cage and has to pay with flesh and blood.  Expect to see their rates go up too and the govt to say well we raised them on the rich now everyone also has to bite the bullet.

Leopold B. Scotch's picture

If you're counting in dollars, already we all pay the inflation tax.

garypaul's picture

BS. The rich are more often recipients of the benefits of inflation.

Harbanger's picture

I'm sure the meme behind taxing 75% of their income, was to Tax the 1%.  And so it goes until socialists go bust and then blame the free market, or capitalism.

jonytk's picture

France will be the next PIIGS in line, mark my words.

Promethus's picture

PIFIGS?

FIPIGS?

IFPIGS?

SPIFIG?

Rory_Breaker's picture

Once UK and Netherlands join along with France we'll have FUKINPIGS

logicalman's picture

Free market?????

Let me know if you can find one.

Capitalism - as common as rocking horse shit.

 

Harbanger's picture

You know that.  But it won't stop them from blaming anything but themselves.  There's always a new Straw man to serve as cover.

garypaul's picture

Exactly. That's the playbook 101. And to prove that I know what I'm talking about, watch this "two year" tax period get extended, and then extended again, etc.

malikai's picture

It's a crisis. We must all pitch in and do our part!

For solidarity.

silvermail's picture

"It's a crisis. We must all pitch in and do our part! For solidarity".

When you say the word "we" who exactly do you mean - we are slaves or we - the owners of slaves?

mrdenis's picture

You didn't earn that money you worked  for ........your government  did.

SilverRhino's picture

Wonder how Johnny Depp feels about that.    How's that socialism working out for ya champ?   

(Disagree with his politics but he had the balls to act on his 'threats') 

Timmay's picture

And when this "Fails"?, global bank account confiscation.....

Long-John-Silver's picture

Anyone with money in a Bank deserves to get what's going to happen to them.

j0nx's picture

Says the guy who lives in his mom's basement and doesn't have any money to keep in the bank anyway. Get the fuck outa here. Where else are you supposed to keep large amounts of cash? In your house where it will burn down or get stolen? Same with gold. Unless you have your own personal vault then good luck with that.

Unpopular Truth's picture

2 wolves and 1 sheep voting what's for dinner.

Leopold B. Scotch's picture

18 morons and 1 farmer voting on who gets to run the farm.

TheGardener's picture

Would hate to admit to be assimilated : that one farmer on subsistence is me.

Harbanger's picture

Every time they try letting morons run the farm they all starve.

The Merovingian's picture

I love cursing in French, it's like wiping my ass with silk ...

Fuck You ObernYellen!

 

Tinky's picture

Poor choice of metaphor, as cotton is much more absorbent. 

RafterManFMJ's picture

Perhaps French shit is like that of rabbits and deer; hard and pebbly?

Pure Evil's picture

That's just a smear on both fabrics.

Calmyourself's picture

Merovingian, your wife's hot...