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TRANSCRIPT
France’s Constitutional Council has struck down a proposed 75 percent top marginal tax rate, ruling it unconstitutional.
“The Council which determines whether laws are constitutional is sometimes referred to as the French Supreme Court. Judges decided that the tax would apply unevenly, as it would hit individuals rather than households.” (Video via euronews)
The tax was structured in such a way that two different households making the same net income could potentially pay two different tax rates. The bill, which was seen as largely a political statement, came from a campaign promise.
“It was a central promise of French President Francois Hollande’s campaign and one of the first he put into action after the election.” (Video via France 24)
The plan was popular with voters, with around 60 percent saying they approved. But it was much less popular with some of France’s wealthiest citizens.
“Actor Gérard Depardieu was among those who threatened to leave over the proposed levy. … The socialist president Francois Hollande’s government has now pledged to draft a new plan.” (Video via Sky News)
But while the council did strike down the top tax rate, it passed several other tax proposals aimed at helping the country tackle its budget deficits.
“However, the court approved another budget measure raising the top income-tax rate for households to 45%, and tightening some existing tax loopholes. The court also approved a plan to roll back an easing of a wealth tax decided by the previous administration...” (Via The Wall Street Journal)
France’s prime minister said the plan would be revised to comply with the council’s decision, pledging to introduce the tax again next year.
