France approves Francois Hollande's 75% 'millionaire tax'
Constitutional council says super tax on salaries above €1 million is legal
France's constitutional council has given President Francois Hollande the green light to introduce a 75 per cent tax rate taking aim at the super rich.
Under the new plan, which the French council found constitutional, companies will have to pay 50 per cent tax on all salaries exceeding one million euros, or the equivalent of approximately £833, 000.
Including social contributions, the rate will effectively stand at 75 per cent, although the total amount will be capped at 5 per cent of a company's turnover.
The levy is set to affect income earned this year and in 2014.
The 'millionaire tax' could affect more than 450 companies and several football clubs, and could raise more than 200 million euros on an annual basis.
The ruling by the French constitutional council, which has powers to annul laws if considered to violate the country's constitution, puts an end of months of speculation and comes after an earlier draft applying to individuals, rather than households, was turned down last year.
The council found that any tax rate above 66 per cent applied to individuals would be confiscatory.
The super tax, a flagship pledge in Hollande's political manifesto, has infuriated business leaders, high earners and celebrities.
French actor Gerard Depardieu gave up his French passport and fled to Russia in response to the controversial tax, claiming that the French government was punishing high earners for their success.
Depardieu's remarks prompted the anger of the socialist party, including Prime Minister Jean-Marc Ayrault, who described his actions as "pathetic".
President Hollande, who once admitted that he dislikes the rich and has been accused of taking an anti-business stance, has fired back at critics insisting that high earners should do more to boost the country's public finances.
But the super tax has sparked fears of a mass exodus of businesses, bankers and celebrities.
Last year, Prime Minister David Cameron said he would "roll out the red carpet" and "welcome more French businesses to Britain" if Hollande raised taxes on the wealthy.
- 1 Howard Jacobson: Let's see the 'criticism' of Israel for what it really is
- 3 Belgium fan Axelle Despiegelaere lands L'Oreal campaign after World Cup viral photo
- 4 Britney Spears sings 'Alien' without Auto-Tune in embarrassingly brilliant leaked audio clip
- 5 PornHub begs users to stop uploading video clips of Brazil getting beaten 7-1
Game of Thrones author George RR Martin says 'f*** you' to fans who fear he will die before finishing Westeros saga
Instagram of US airport security chiefs: Lipstick knives and IED training kits among items seized
‘Ryan Gosling got someone pregnant and it's not me. Brazil you think you’re devastated…’
Israel-Palestine crisis: ‘We just want it to end… We don’t deserve to live like this’
Israel-Palestine crisis: Eight killed in Gaza Strip cafe while watching World Cup semi-final
Sustained immigration has not harmed Britons' employment, say government advisers
Australia facing international condemnation after turning around Sri Lankans at sea
7/7 memorial defaced on anniversary of 2005 attacks with ‘Blair lied thousands died’ graffiti
Even when it brutalises one of its own teenage citizens, America is helpless against Israel
There’s a nasty smell in the political air – and it’s coming from the Tories
Vanessa Feltz criticises 'vile' reaction to Rolf Harris allegations
iJobs Money & Business
£60000 - £75000 per annum: Harrington Starr: Business Analyst Consultant (Fina...
£60000 per annum: Harrington Starr: A leading provider in investment managemen...
£600 - £700 per day: Harrington Starr: AVS, JVS Openlink Endur Developer JVS, ...
£30000 per annum: Harrington Starr: A global leader in trading platforms and e...