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France

Hollande vows 75% tax rate for France's top earners

Text by News Wires

Latest update : 2012-03-06

Socialist Party presidential candidate Francois Hollande has set his sights on taxing the rich with plans to introduce a 75 percent tax rate for France's top earners. Hollande said it would be a “patriotic” move to revive France’s ailing economy.

AFP - The Socialist tipped to become France's next president took aim at the wealthy Tuesday with plans to slap a 75 percent tax rate on top earners.

Francois Hollande said it was simply a case of "patriotism to accept to pay extra tax to get the country back on its feet again" and reverse the policies of President Nicolas Sarkozy that he said favoured the rich.

"It is sending out a signal, a message of social cohesion," he said during a tour of France's annual agricultural fair in Paris.

Taxing the rich has become a hot issue in an election campaign marked by worry over the economic crisis and rising unemployment, which now stands at nearly three million.

Hollande, who opinion polls consistently put ahead of Sarkozy in the race to win the presidential elections in April and May, unveiled the 75 percent tax rate plan late Monday on a television show.

"I have seen the considerable progression of the pay of the CAC 40 (benchmark French stock market index) bosses. Two million euros (a year) on average. How can we accept that?" he asked.

Hollande said he would slap the tax rate on all French people who earned more than a million euros ($1.3 million) a year. He had earlier said he wanted to impose a rate of 45 percent on incomes above 150,000 euros a year.

He had said in his first campaign rally late last month that the "enemy" was "the world of finance".

The new plan sparked fierce criticism and some ridicule from Sarkozy's UMP party and from other presidential candidates who are all vying to show that they have the magic formula to pull France out of economic crisis.

Hollande "invents a new tax every week without ever proposing the smallest saving", said Budget Minister Valerie Pecresse, while Foreign Minister Alain Juppe denounced the plan as "fiscal confiscation".

"And why not a 100 percent rate?" was the sarcastic reaction from Marine Le Pen, the leader of the far-right National Front who polls put in third position in the presidential race.

When Sarkozy came to power in 2007, he introduced a "tax shield" that capped tax at 50 percent of all income. The move was slammed by the opposition as a gift to the rich.

Sarkozy also cut inheritance and other taxes on the rich early in his mandate.

Sarkozy has been campaigning with a call for the French people to stand with him against a defeatist elite and to defend the traditional values of a strong France.

The latest opinion poll, published Tuesday by IFOP, said he had narrowed Hollande's lead. It said the Socialist would take 28.5 percent of the vote in the first round, while the president stood at 27 percent.

The second round would however see Hollande romping home with 56.5 percent against Sarkozy's 43.5 percent.

Le Pen was in third position in the first round with 17 percent, the poll said.

France will vote in the first round of the presidential election on April 22, followed by a second-round run-off on May 6.

Date created : 2012-02-28

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