France Introduces New Tax on High Incomes- At the Request of the Rich

Another reason to love the French…

This is an example of how you should handle deficits- both as a government and as a citizen.

This U.S. Congress is doing all it can to protect its millionaires from paying their fair share while taking more and more from the Middle Class and the poor.

The French also know a little bit about how nasty class warfare can become when the Rich have too much and flaunt it too openly.  They learned the hard way, it’s best to all pull together in the spirit of equality and solidarity.

I don’t want to hear a damn thing about “freedom fries”….

Viva la France!

 

 

The French government is to impose an extra tax of 3% on annual income above 500,000 euros (£440,000; $721,000).

It is part of a package of measures to try to cut the country’s deficit by 12bn euros over two years.

The tax increase came after some of France’s wealthiest people had called on the government to tackle its deficit by raising taxes on the rich.

Paris has also reduced its economic growth forecast for 2012 to 1.75% from a previous 2.25%.

‘Rigorous’

And it has cut its 2011 growth forecast from 2% to 1.75%, Prime Minister Francois Fillon has said.

He said the new tax would remain in place until France reduces its budget deficit back under the EU’s intended limit of 3% of GDP, which should occur in 2013.

France plans to trim its public deficit to 5.7 % this year, 4.6 % next year and 3% in 2013.

“This is a rigorous policy that will allow France to remain relaxed,” Mr Fillon said. “Our country must stick to its [deficit] commitments. It’s in the interest of all French people.”

Faced with flat growth, the persistent threat to the country’s precious AAA rating, and all sorts of turmoil on the nervous financial markets, President Sarkozy is wielding the axe.

In total he’s proposing 12bn euros of savings over the next two years.

Higher taxes for big companies, a cap on tax deductions applying to overtime – and a new “special contribution” from the wealthiest in the country.

It’s a U-turn – in so many ways – designed to reassure investors and voters alike that only he can be trusted with the French economy.

Sixteen executives, including Europe’s richest woman, the L’Oreal heiress Liliane Bettencourt, had offered in an open letter to pay a “special contribution” in a spirit of “solidarity”.

It appeared on the website of the French magazine Le Nouvel Observateur.

It was signed by some of France’s most high-profile chief executives, including Christophe de Margerie of oil firm Total, Frederic Oudea of bank Societe Generale, and Air France’s Jean-Cyril Spinetta.

They said: “We, the presidents and leaders of industry, businessmen and women, bankers and wealthy citizens would like the richest people to have to pay a ‘special contribution’.”

They said they had benefited from the French system and that: “When the public finances deficit and the prospects of a worsening state debt threaten the future of France and Europe and when the government is asking everybody for solidarity, it seems necessary for us to contribute.”

They warned, however, that the contribution should not be so severe that it would provoke an exodus of the rich or increased tax avoidance.

via BBC News – France introduces new tax on high incomes.