We’ve all heard a lot of talk about taxing the rich more. In fact, the Occupy Wall Street movement did accomplish one thing–awareness. I will agree that there are some abused tax relief techniques that the super-rich use to avoid paying their fair share.
However, I must say to the new tax in France….GIVE ME A BREAK!
France’s Socialist President Francois Hollande got big headlines for his planned 75% tax rate on individual incomes over one million Euros. This will make France the highest-tax country on the planet.
I guess what really is irritating to me is this is being enacted to shrink France’s budget deficit. But there is really more going on here. Much like in America, there is this movement against the rich, and this tax is to set an example. It’s a political statement. Yes, the taxes do raise revenue, but not to the degree that is hoped. The main reason is fairness, plain and simple.
The United States had rates as high as 70% as recently as 1980! Yikes! President Reagan convinced Congress to reduce that rate dramatically. Those rates were a serious drag on the economy and reduced prosperity. By the end of Reagan’s second term, the economy was booming and the rates had come down to 28%. Hmmmm, coincidence?
What would you do if your top tax rate in America became 75%? I’m pretty sure I’d move to another country. That’s exactly what will happen with many of the French super-rich. Along with them go jobs and money that would have been spent in the economy.
Milking the rich might seem like a good idea, especially in a tough economy. It’s a dangerous agenda. So what will this accomplish? Not much.
Give me a break.