Our recent story about French President Francois Hollande’s move to hike taxes on the country’s rich struck a chord among Internet commenters — as one might expect for an article with “socialist” in the headline.
“French President Francois Hollande has made good on a campaign pledge to make the wealthiest in France pay up to 75 percent income tax,” The Washington Post’s Michael Birnbaum reported.
“Although the new taxes will not make a major dent in France’s budget, they have delighted the country’s labor unions and others who thought that former president Nicolas Sarkozy, nicknamed President Bling-Bling, gave the wealthy a pass as he called for deep cuts in government spending on the poor. But the rapidly rising tax rates have some businesses and investors saying that economic growth, forecast at a catatonic 0.2 percent this year, will further suffer.”
Readers had a number of different takes, including speculating on the true reason behind the tax increase and on potential ways businesses could avoid it.
There was a particularly lively debate on the social news site Reddit, where the comments can be broken down into roughly three categories (all punctuation sic):
Some believed the true goal of the tax was either to encourage business executives to lower their taxable incomes, or to give the appearance that Hollande’s government is tough on the wealthy so that the less-affluent will be willing to make concessions down the line:
“French here. The thing with this tax, is that it starts when the annual income is more than 1.000.000€. And the tax doesn't start at 75%, otherwise it would be just moronic, and no man with a bit of a brain would have agreed to sign for such a tax.
The goal of this tax, is actually to force the wealthiest, to lower their taxable income. The main people targeted are the top bosses, so they would "share" more of their companies benefits with the employees.”
It's a political move.
From the article:
“From a strictly economic point of view, I wouldn’t recommend these policies. But that’s not what this is,” said Elie Cohen, an economist who has advised Sarkozy and Hollande. “This is clearly designed to create some kind of consensus in this country for structural reforms”“The social security system, labour market and businesses in France weighed down in bureaucratic regulation. However attempted reforms in these areas often bring huge numbers onto the streets and can result in strikes that cripple the national infrastructure and even riots.
The 75% tax is about taxing the rich. It will raise little if any money. But it does allow Hollande to say: See, we are taxing those nasty millionaires but we need all the French people to make sacrifices too. If he were to just do austerity for the poor and middle classes and leave the rich to swan around just getting richer (which is happening everywhere in world in this depression) then the country would be in uproar.”
Other readers schemed about skipping out on taxes in any given country in the euro zone, which is apparently a stealthy, convoluted process:
“This tax is practically stupid. People that make more than 1M€/year usually work for multinational companies. I've read an article lately on how France based top managers are already getting their work contract transferred in another headquarter in Europe to avoid this tax. In the end, I'm pretty sure that the effect of this tax will lower the french global tax income.”
“Depends on the national laws. In Germany you have to spend most of the time outside the country (183 days or more) if you want to be taxed there. Even a 4 week home vacation can turn into nasty problems. Basically if you transfer your work contract, you have to transfer yourself. I have some friends working in Switzerland. They return home on weekends. If theyre found out they´ll end up repaying taxes until the rapture.”
diemockingbirddie: Wouldn't they just leave France?
KibboKift: “There are 500,000 French people in London for a reason”
super_jambo: “It's the food man.”
LordMorbis: “It's the weather, man.”
volar92: “It's the olympics, man.”
YeahBruvInit: “it's the men, man.”
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