The failing economy and harsh taxes of François Hollande's beleaguered
nation are sending thousands packing - to Britain's friendlier shores
By By Anne-Elisabeth
A poll on the front page of last Tuesday’s Le Monde, that bible
of the French Left-leaning Establishment (think a simultaneously boring and
hectoring Guardian), translated into stark figures the winter of François
Hollande’s discontent.
More than 70 per cent of the French feel taxes are “excessive”, and 80 per
cent believe the president’s economic policy is “misguided” and “inefficient”.
This goes far beyond the tax exiles such as Gérard Depardieu, members of the
Peugeot family or Chanel’s owners.
Worse, after decades of living in one of the most redistributive systems in
western Europe, 54 per cent of the French believe that taxes — of which there
have been 84 new ones in the past two years, rising from 42 per cent of GDP in
2009 to 46.3 per cent this year — now widen social inequalities instead of
reducing them.
This is a noteworthy departure, in a country where the much-vaunted value
of “equality” has historically been tinged with envy and resentment of the more
fortunate. Less than two years ago, the most toxic accusation levied at Nicolas
Sarkozy was of being “le président des riches”, favouring his yacht-sailing CEO
buddies with tax breaks and sweet deals. By contrast, Hollande, the bling-free
candidate, was elected on a platform of increasing state spending by promising
to create 60,000 teachers’ jobs, as well as 150,000 subsidised entry-level
public-service jobs for the long-time unemployed and the young — without
providing for significant savings elsewhere.
By 2014, France’s public expenditure will overtake Denmark’s to become the
world’s highest: 57 per cent of GDP. In effect, just to keep in the same place,
like a hamster on a wheel, and ensure that the European Central Bank in
Frankfurt isn’t too unhappy with us, Hollande now needs cash. Technocrats, MPs
and ministers have been instructed to find every euro they can rake in — in
deferred benefits, cancelled tax credits, extra levies. As they ignore the
notion of making some serious cuts (mooted at regular intervals by the IMF, the
OECD and even France’s own Cour des Comptes), the result can be messy.
On the one hand, the lacklustre economy and finance minister Pierre
Moscovici recently admitted that he “understood” the French’s “exasperation”
with their heavy tax burden. This earned him a sharp rap on the fingers from
the president and his beleaguered PM, Jean-Marc Ayrault. On the other, new
taxes keep being announced, in chaotic fashion, nearly every week. “Announced”
doesn’t mean “implemented”: the Hollande crowd have developed a unique Wile E
Coyote-style of leaks, technical glitches, last-minute tweaks and horse-market
bargaining whereby almost nobody knows, at any given time, who will be targeted
by the taxman, and how. Unsurprisingly, this is liked by no one except us
reptiles of the press, eager to report on the longest series of own goals in
the history of government communications.
Take last year’s famous 75 per cent supertax, on individuals earning over
one million euros a month. This has still not been implemented. First, it got
struck down by France’s Constitutional Council on a technicality. Leaks
suggested the rate would fall to 66 per cent. They were confirmed, then denied.
Hollande eventually vowed that the tax would be paid by the targeted individuals’
employers, for daring to offer such “obscenely” high salaries. This has just
been approved by the National Assembly, and must still pass the Senate. So far,
it is only supposed to apply to 2013 and 2014 income, but no one knows if the
bill will be prolonged, killed or transformed....
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