IT'S TIME TO BUILD AN IRON CURTAIN AROUND FRANCE TO KEEP THEIR PEOPLES FROM FLEEING?? Hollande's 'New' 75%-Wealth-Tax Catches French Soccer Pros Offside

Hollande's 'New' 75%-Wealth-Tax Catches French Soccer Pros Offside | Zero Hedge


IT'S TIME TO BUILD AN IRON CURTAIN AROUND FRANCE TO KEEP THEIR PEOPLES FROM FLEEING??

Hollande's 'New' 75%-Wealth-Tax Catches French Soccer Pros Offside

Submitted by Tyler Durden on 04/02/2013 21:09 -0400

• Belgium
 
• France

The ever-changing rules of the French 'tax-the-rich' socialist state have mad eyet another unintended consequence. Bloomberg reports that Prime Minister Jean-March Ayrault confirmed this evening that France's professional soccer players will be liable for the 75% 'surcharge' on salaries above EUR1 million. After the country’s top administrative court said any rate above 66% could be rejected as confiscatory, Hollande revived the tax, saying the rate would remain 75%, though it would be paid by corporations, not individuals, circumventing the courts’ objections. That solution left open the question of whether self- employed artists and athletes would be taxed - Ayrault confirmed it today. We suspect the transfer window will be wide open as soon as possible as "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." Paris St. Germain, David Beckham's current team, has over a dozen players/coaches paid more than EUR1mm and with Zlatan Ibrahimovic at EUR15mm per year, we suspect the Swede will be heading back to England as soon as possible - or maybe Cyprus needs some players?

Via Bloomberg,

Paris St. Germain, France’s richest soccer club, ...

PSG’s Qatari owners also have the tax man to think about. After conflicting messages by government officials, Prime Minister Jean-Marc Ayrault’s office issued a statement today confirming that a 75 percent surcharge on salaries above 1 million euros ($1.3 million) will apply to soccer clubs.

“This new tax will cost first-division teams 82 million euros,” France’s Football League said in a statement.“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.”

At least 12 members of the Paris team make more than 1 million a year, according to France Football magazine. They include Swedish striker Zlatan Ibrahimovic, 15 million euros a year, and Italian coach Carlo Ancelotti, at 12 million euros.

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Many soccer players would already be taxed at France’s top marginal rate of 49 percent, which kicks in at 500,000 euros a year. Teams would then pay a surcharge to bring the effective tax rate on salaries above 1 million euros to 75 percent.

Court Ruling

A first attempt to put the tax into law was shot down by the constitutional court last December because the tax applied to individuals and not households. While the government then said it would rewrite the tax for 2014,the country’s top administrative court said any rate above 66 percent could be rejected as confiscatory.

In a television interview last week, Hollande revived the tax, saying the rate would remain 75 percent, though it would be paid by corporations, not individuals, circumventing the courts’ objections.

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In an interview with Journal du Dimanche March 31,Ayrault avoided the question, saying that some companies paid “indecent” salaries and joking that actor Gerard Depardieu, who has left France for Belgium, thought taxes are already too high in France.