LG
05-21-2013, 05:36 PM
Well, America's rich, the fiscal cliff compromise that bumped the top effective income tax rate from 35% to 39.6% could have been a lot worse. The deal could have taken all of it and more.
That's what happened in France, where Reuters says more than 8,000 French households' tax bills topped 100% of their income last year. Business newspaper Les Echos, citing Finance Ministry data, reported Saturday that the huge tax hit stemmed from a one-off levy last year on 2011 incomes for households with assets of more than 1.3 million euros ($1.67 million).
President Francois Hollande's Socialist government imposed the tax surcharge last year to offset the cost of a rebate set up by predecessor Nicolas Sarkozy that capped an individual's overall tax rate at 50% of income.
Hollande's government has been trying to impose a temporary 75% tax on earnings over 1 million euros, but France's Constitutional Council ruled that the rate was unfair and threw it out. An administrative court has since declared that a marginal tax rate higher than 66.66% percent imposed on a single household borders on confiscatory. The government is now trying to revamp its proposal to hit companies instead of individuals.
Even that has been a problem, as soccer clubs including Paris Saint-Germain, the richest in France, are considered companies under the revised law. Prime Minister Jean-Marc Ayrault's office issued a statement in April confirming that the surcharge will apply to soccer clubs, including PSG. Considering that a dozen members of the PSG roster make 1 million euros or more, France's soccer authorities are, at best, unhappy.
"With these crazy labor costs, France will lose its best players, our clubs will see their competitiveness in Europe decline, and the government will lose its best taxpayers," France's Football League said.
The effects are already being felt. PSG coach Carlos Ancelotti has asked to leave the club for Spanish La Liga powerhouse Real Madrid, according to The Guardian, while PSG superstar David Beckham opted to retire.
Still, the redrafted law had no effect on the onerous one-time levy. Les Echos reported that nearly 12,000 households paid taxes last year worth more than 75% of their 2011 incomes. There's no word on whether that included actor Gerard Depardieu, who retreated to Belgium to avoid the tax.
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That's what happened in France, where Reuters says more than 8,000 French households' tax bills topped 100% of their income last year. Business newspaper Les Echos, citing Finance Ministry data, reported Saturday that the huge tax hit stemmed from a one-off levy last year on 2011 incomes for households with assets of more than 1.3 million euros ($1.67 million).
President Francois Hollande's Socialist government imposed the tax surcharge last year to offset the cost of a rebate set up by predecessor Nicolas Sarkozy that capped an individual's overall tax rate at 50% of income.
Hollande's government has been trying to impose a temporary 75% tax on earnings over 1 million euros, but France's Constitutional Council ruled that the rate was unfair and threw it out. An administrative court has since declared that a marginal tax rate higher than 66.66% percent imposed on a single household borders on confiscatory. The government is now trying to revamp its proposal to hit companies instead of individuals.
Even that has been a problem, as soccer clubs including Paris Saint-Germain, the richest in France, are considered companies under the revised law. Prime Minister Jean-Marc Ayrault's office issued a statement in April confirming that the surcharge will apply to soccer clubs, including PSG. Considering that a dozen members of the PSG roster make 1 million euros or more, France's soccer authorities are, at best, unhappy.
"With these crazy labor costs, France will lose its best players, our clubs will see their competitiveness in Europe decline, and the government will lose its best taxpayers," France's Football League said.
The effects are already being felt. PSG coach Carlos Ancelotti has asked to leave the club for Spanish La Liga powerhouse Real Madrid, according to The Guardian, while PSG superstar David Beckham opted to retire.
Still, the redrafted law had no effect on the onerous one-time levy. Les Echos reported that nearly 12,000 households paid taxes last year worth more than 75% of their 2011 incomes. There's no word on whether that included actor Gerard Depardieu, who retreated to Belgium to avoid the tax.
msn