France throws out tax hike on the rich

France- The high court for France struck down a supertax on its nations most elite individuals. This serves as a major blow to President Francois Hollande’s plan to repair France’s economy. This came days before it was proposed to pass the high court.

The high court saw that taxing individuals income over 1.32 million at a 75% tax rate was unconstitutional and highly unfair.

Almost immediately the socialist President vowed to modify and resubmit the proposal which had been passed by the Parliament earlier in the month.

Prime Minister Jean-Marc Ayrault said in a statement that a new proposal to tax the rich “taking into account the principles raised by the Constitutional Council’s decision” would be drawn up as part of the next budget law submitted in 2013 or 2014. No further details of how and when this would be done were given.

The controversial measure was a pillar of Hollande’s success presidential campaign. The measure was proposed on a temporary basis and would effect less that 2000 people in the entire population of France and raise just shy of under a billion dollars during it being in effect. This will hardly solve the financial crisis that burdens this country.

This was just one of several measure s proposed by Hollande to bring down the countries spending deficit to 3% of its gross domestic product. The proposed timeframe for this to occur was within five years or his full term in office.

The measure which was widely support by the leftist wing of the political party drew nothing but criticism from conservatives and business owners that were concerned that such high tax rates would drive wealthy entrepreneurs to flee the country.

These concerns held footing when two of France’s most elite jumped shipped to move to Belgium supposedly to avoid the 75% tax rate. One of those two individuals is world renowned billionare Bernard Arnault, owner of luxury goods company Luis Vuitton.

A number of French nationales already have jumped ship to move to Switzerland, Belgium, and Britain which boast predominately lower tax burdens on the wealthy.

The ruling released by the Council on Saturday struck down the measure because it “failed to recognize equality” The proposed rule change would impact individuals only on income over 1.3 million dollars whereas everyone else in the country would skirt those high tax rates. This tax proposal would indirectly effect a small portion of the population in an unfair manner.

Upon hearing about this unfair ruling Finance Minister Pierre Moscovici recently confirmed that the federal government of France will not drop its pursuit to tax the wealthy to solve its debt crisis.

“Our deficit-cutting path will not be diverted,” Moscovici told BFM television.