FRANCE 24, LES ECHOS (France), GUARDIAN, EVENING STANDARD (UK), BLOOMBERG (USA)
LONDON - Are the rich and the entrepreneurs leaving France? Boris Johnson, the mayor of London, certainly hopes so.
Pointing to the 240,000 Frenchmen who currently live in his city, he invited those unhappy with the French government’s new tax scheme to move to the United Kingdom, Bloomberg reported. “Not since 1789 has there been such tyranny in France,” Johnson joked. "I am keen to welcome talented French people…" he added, "vous etes tres bienvenus!"
Boris Johnson says 75% French tax rate "worst tyranny since 1789". Worse than the Terror and Nazi occupation? Buffoon— Pascal Jacquemain (@jacquep) October 9, 2012
The French government’s new tax scheme is to include a 75 % tax on incomes above a million euros a year, and there will be no more upper limit on the wealth tax, the ISF, which is levied not on income but on total property and assets.
Moreover, the government recently announced it would be raising the capital gains tax (which applies to sales of businesses and stock) from its current rate of 19% (33% including social charges) to more than 62%. This provoked a mass rebellion on the part of France's entrepreneurs, labeling themselves the pigeons [French for “suckers”], who complained that the tax would put an end to new business startups.
They argued that the uncertainty of forming a new business, with its high risk of failure, must pay off in the form of capital gains or no one will think it worthwhile to take the risk, and no new business will come to France. The government was taken by surprise by the extent of the revolt, especially online, which came from "small business entrepreneurs and internet startups, with a friendly image, who aren’t from the upper class,” wrote Dominique Seux in financial newspaper Les Echos.
The Guardian reported that Hollande’s office told Reuters, “We don't want to give the impression that we want to punish the Pigeons… We'll find a solution.” “We probably made a mistake,” the Minister of the Budget, Jérôme Cahuzac, told Libération. No changes have yet been officially announced.
Meanwhile, high-end real estate company Daniel Féau told reporters from France 24 that 400 to 500 apartments worth more than one million euros ($1.3 million) have come onto the Paris market in the past two months. “It’s like everyone is panicking,” said one manager.
A senior socialist party source told the Evening Standard, “France is now a fully Socialist country, and thus not a place where the rich can feel comfortable… they will all have to realize that they have a responsibility to the rest of society.”