to not be surprised that France's intention to heavily tax the rich will result in less tax intake?(110 Posts)
It obvious to everyone except Hollande that if you inflict a punitive tax on the rich (75%) then they will simply leave the country and take their wealth with them.
It has never worked to inflict punitive taxes on the rich as they will simply vote with their feet and now France is suffering due to this stupid policy.
I do agree that all sectors of society need to pay their way but in most countries income tax banding means that the rich will already being more since a salary of say, £90000 taxed at 40% will pay more tax than a salary of £50000 taxed at 40%. Unearned wealth is another matter but those paying tax (via payroll taxes on a salary) already pay more.
It's not just the jet set though, it's entrepreneurs and people who have built successful businesses, people like Bernard Arnault (said to be the richest man in Europe).
The top 1% of earners in the UK pay 30% of all tax income, so, assuming that it is a similar situation in France, you really don't want them to leave.
If people will leave france then they will also leave the uk if we also increased taxation.
The rich and their money can go anywhere and dont have the same ties as your average working person.
This article from Reuters says it kicks in at 800,000 euros.
Taking 50% or more of someone's money is somehow disrespectful.
It says "You are too rich!",
I think that demeans them as a person and rubs off in them not feeling society respects how they earn that money.
A business person, actor, or a sportsperson may realise what they are paid is silly, but they still want their skills to be appreciated.
They may give a great deal to charity or they may not, but they still feel it should be their choice not the governments.
If expanding a business, with all the risk that that entails, was likely to take someone over the 800,000 threshold, I wonder how many people would think twice now.
They don't take 50% of their money.They take 50% of incomes over a certain threshold
People cannot just upsticks and move their life abroad so easily.Also by moving abroad you do not necessarily avoid tax on income earned in the UK
You might be right socharlotte, and it will be interesting to see where this policy leads France over the coming years - maybe to a socialist utopia, maybe not. We need to reconvene in 5 years!
my dh is a high earner,if that happened here we would leave for sure.we are already planning to in 2 years.
its not fair,you work hard to achieve something then get penalised for it.
plus high earners put the most into the pot,but probably take the least out of it.
for example,my husband pays more tax than most people earn in a year,or even several years,and thats without all the people he employs too.
yet we have never used hospitals,doctors,nurseries or schools and dont recieve any benefits at all.
I know we are an extreme case and tax pays for more than that but its point i have to make..
If Bernard Arnault and his multi millon pound fortune finds it so easy to leave france then i dont see how any other rich person is going to struggle with it.
Amber - I'm sure DH and I put in more than we take out...that's fine because one of the things we do get out is being able to live in a pretty much civilized society.
However, punitive taxation doesn't appear to work well in practice. People leave, or find avoidance schemes. Whichever way you argue the ethics, pragmatically I reckon Hollande has overstepped the mark.
Isn't there a country that dropped their tax / vat rate to some ridiculously low rate and ended up with more money then when it was higher. As there was no need for cash in hand jobs and everything was declared.
The problem with Hollande and too many members of his party is that they want to take from the rich.
They also seem to want to stop people from being successful - I haven't yet read the full details of what they are planning for small business owners but very many small business owners are very unhappy (and were already still angry because of the 35hour week implemented by the socialists in the late 90s).
Hell would have to freeze over before I would vote for the Tories in the UK, but the French socialists have a tendancy to go too far in the other direction, creating vote winning policies which don't add up to much practically pr economically.
Startail I don't get your point. Why is it disrespectful to tax someone who plays football more than 50% over a threshold any more than it is disrespectful to pay someone useful like a nurse less than the footballer earns in a week?
Society has got the values all wrong. And too many people think they are rich because they are deserving and special rather than lucky! I'll be interested to see how it pans out in France, but I find it really depressing and selfish that people would rather leave than pay.
I am old enough to remember 1974 when the government put the top rate income tax rate up to 83%. If you then took into account tax on investment income this gave a top marginal income tax rate of 98%!
A lot of high profile names left the UK - people like Michael Caine and Mick Jagger because of it.
I think that Hollande has been politically motivated by this, and I think that it has backfired on him - especially in the case of Gerard Depardieu, who is more working class (and more popular) than Hollande .
Gerard Depardieu has had a lot of stick by the french socialists over his choice to leave France. They have publicly stated he is shirking his patriotic responsibilities.
I love GD and wish he had choosen to come to the uk
Gérard Depardieu was pretty much supported in his decision to leave by most French people until he went and brown nosed Putin. That was very very bizarre behaviour, and within days he has lost masses of respect in France.
France is screwed. London is full of talented French people who'll never go back.
PetiteRaleuse GD announced his discion to give up his french passport after the socialist party had a pop at him and criticised his discion to move abroad. And i for one dont blame him
His open letter sent after Prime Minister Jean-Marc Ayrault who called the actors action pathetic.
Im leaving because you think success, creation, talent and anything different should be punished. I am sending you back my passport and social security, which I have never used.
If you read any reports on the London property market, the £1m-£3m section (rather than the Russian/Arab type £10-£50m section) is currently being driven higher in a large part by higher by wealthy French families moving over here since Hollande was elected - so it is happening, not just conjecture.
*Taking 50% or more of someone's money is somehow disrespectful.
It says "You are too rich!"*
That doesn't make any sense to me. Why 50%? Is 49% disrespectful? How about 45% or 40%?
The reality is that the gov needs money to run (whether they could do it on less is a different issue) and someone has to pay it, poor or rich. Regardless how you set it up someone is going to think it unfair. Flat rate tax benefits some and penalises others, sales only tax ditto.
France could always do like the U.S. If you are a U.S. citizen then you have to declare earnings and are liable even if you are abroad. Even if you denounce your citizenship you are still liable for a while. You may be able to write off some or all of the money you earned elsewhere if you pay taxes there.
So Gerald Depardieu would have to denounce his French citizenship.
I don't blame him for leaving France, but it is the fact he has taken Russian nationality and gone on about what a great democratic leader Putin is which has shocked so many French people. They were supportive of him after his open letter. Now he is ridiculed.
I hope France isn't screwed. Am pretty shocked at how gleeful the British press and very many Brits are when things go wrong in France. It's very sad.
I can't remember where I read this, but apparently the way to net the most tax is not to add tax onto the super-rich, but to place a uniform £30% tax on absolutely every wage earner, regardless of wage. Because of course there are far more people on middle incomes than the very rich.
Can't imagine that going down well anywhere, but goes to show that taxing the super rich is not about money but politics, which is of course the case in France.
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