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France

France’s richest man ditches Belgium tax-dodge plan

Text by FRANCE 24

Latest update : 2013-04-11

France’s richest man said Wednesday he had withdrawn his request for Belgian nationality and would continue to pay tax in France. By ditching his French passport, Bernard Arnault (pictured) would have avoided a proposed 75% tax on millionaires.

Bernard Arnault, France’s richest man, has abandoned attempts to obtain Belgian nationality and will keep paying tax in his native country after months of speculation that he, like movie star Gerard Depardieu, would escape a 75% supertax.

The head of the LVMH luxury goods empire, whose citizenship request in Belgium looked doomed, announced his decision in a newspaper interview on Wednesday, saying he had never intended to flee the taxman.

“That message never sank in. Today I’ve decided to bring the confusion to an end. I am withdrawing my request for Belgian nationality,” Arnault told daily Le Monde.

News last year that he had lodged the request sparked angry accusations from French Socialist leaders and other left-wingers that he lacked patriotism at a time when Europe’s second-largest economy was at a standstill and creaking under huge debts.

Arnault’s request for Belgian nationality appeared began to look improbable in January after a Brussels court handed down a negative opinion on it to the Office of Foreigners immigration office, Belgian media quoted the office’s spokesman as saying.

Arnault said his frustrated efforts to acquire nationality in Belgium were motivated not by tax concerns but a desire to tie up legal ownership issues so that his children would not fight over the riches he would one day leave to them.

“Given the situation the country is in, the recovery effort needs to be shared, and with this gesture I hope to show my attachment to France and confidence in its future,” he told Le Monde.

'One of France’s top taxpayers'

The LVMH chief executive said the luxury goods giant paid more than a billion euros in tax on profit in France, more than half of its total tax bill, even though 90% of its sales were abroad.

While refusing to reveal his personal tax bill he said he was “undoubtedly one of France’s top taxpayers”.

Socialist President Francois Hollande promised a 75% supertax on incomes over a million euros per year when he came to power last May.

But after a top court slapped down the initiative, Hollande said in March he was modifying that plan to have companies pay the tax for employees paid more than a million euros, rather than have individuals paying it themselves.

Arnault said he had rejected moves by some of his employees to seek tax residence outside France.

“Some of them asked to be domiciled outside France but I resisted,” he said.

Actor Gerard Depardieu, the star of films such as Green Card and Cyrano de Bergerac, was accused by French leaders last year of making a “pathetic” attempt to dodge the taxman when he bought a house across the border in Belgium.

He responded furiously, publicly accepting an offer of Russian citizenship from President Vladimir Putin.

Arnault said the 75% tax would not raise a lot of revenue but should prove less divisive now that it was set to be levied on firms rather than people and only due to stay in place for two years.

France’s premier football league says the tax will probably raise 82 million euros from its soccer clubs.

(FRANCE 24 with wires)

Date created : 2013-04-11

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