French declare taxes on rich as "unfair"

http://www.zerohedge.com/news/2012-12-29/french-constitution-court-strikes-down-75-millionaire-tax-finds-it-unfair

"In a crushing blow to socialism, wealth redistribution and purveyors of the "fairness doctrine" everywhere, the French Constitutional Council ruled on Saturday that Holland's brilliant idea to tax millionares at a 75% tax rate - a move which has since seen numerous millionares leave France and move to Belgium - is unconstitutional. Per Reuters, the Council ruled that the planned 75% tax on annual income above 1 million euros - a flagship measure of Hoolande's election campaign - was unfair in the way it would be applied to different households. Which is ironic because just like in the US, so in France, the selective wealth redistribution campaign waged by the government against the "rich" (which have yet to be properly defined: those making over $250 K? Over $400 K? Over 1 MM?) was based on the premise that it is only "fair" that the rich contribute more. Turns out fairness in the eye of the government beholder, was unfair. But the move begs the question: would the court have struck down the law had it been a merely 50% tax hike? And if the income cut off was, say 500,000 euros? The far bigger question is, and has been in this year of encroaching socialism, just what is the definition of "rich", what is the definition of "fair redistribution", and where do the two coincide. Finally, how soon until the US Supreme Court weighs in as well on any final Fiscal Cliff tax hike proposal which, like France, will see the "rich" pay an abnormal share, and will that too be ruled unconstitutional?

Ideological issue aside, the Hollande tax hike was supposed to provide cover for even more French government spending - remember: under socialism the government believes it konws how to spend the money best.....and most. That this tax hike rejection happened even as France was increasingly under the microscope of various entitles warning that the French budget is unsustainable, will only exacerbate fears that the government will drift even more into the red.

Which then begs the question: once the SNB stops recycling the EURs it buys into French sovereign bonds, the only driver of low French yields in the past 2 quarters, how will France preserve the Ponzi-offset illusion that rampant socialism is not on the radar screens of bond vigilantees everywhere.

And will 2013 finally be the year in which the focus finally shifts from the European bailout addicts to the European enablers, who are just as insolvent but who have been using the distraction of the PIIGS quite effectively for the 3rd year running?

Originally posted by whodey
http://www.zerohedge.com/news/2012-12-29/french-constitution-court-strikes-down-75-millionaire-tax-finds-it-unfair

"In a crushing blow to socialism, wealth redistribution and purveyors of the "fairness doctrine" everywhere, the French Constitutional Council ruled on Saturday that Holland's brilliant idea to tax millionares at a 75% tax rate - a move which ...[text shortened]... en using the distraction of the PIIGS quite effectively for the 3rd year running?

While I think that a 75% marginal tax rate is a terrible idea because 75% (before other use taxes) is such a high number that it discourages production and encourages tax flight, I do find it bizarre that the judiciary would take it upon itself to make a decision to overturn duly passed legislation on the grounds that it is unfair to millionaires.

I don't see it as the judiciary's role to save people from their own electoral choices, however stupid.

Originally posted by sh76
While I think that a 75% marginal tax rate is a terrible idea because 75% (before other use taxes) is such a high number that it discourages production and encourages tax flight, I do find it bizarre that the judiciary would take it upon itself to make a decision to overturn duly passed legislation on the grounds that it is unfair to millionaires.

I don't see it as the judiciary's role to save people from their own electoral choices, however stupid.

Originally posted by sh76
While I think that a 75% marginal tax rate is a terrible idea because 75% (before other use taxes) is such a high number that it discourages production and encourages tax flight, I do find it bizarre that the judiciary would take it upon itself to make a decision to overturn duly passed legislation on the grounds that it is unfair to millionaires.

I don't see it as the judiciary's role to save people from their own electoral choices, however stupid.

In its ruling on Saturday, the Constitutional Council said the new tax rate "failed to recognise equality before public burdens" because, unlike other forms of income tax, it was to be applied to individuals rather than households.

For example, that meant a household in which one person earned more than 1m euros would pay the tax, but a household in which two people earned 900,000 euros each would not have to pay.

Originally posted by KazetNagorra
What whodey's hysterical foaming-at-the-mouth piece failed to mention in detail is that one of the main reasons the law was struck down is because (for whatever reason) the law applied to individuals and not to households, while other tax laws apply to households. So the constitutional court deemed the law to be "unfair" not because the percentage was t ...[text shortened]... ot happen. As it did not happen for the 50-odd years when the top rate was 70%+ in the US.

Originally posted by KazetNagorra
What whodey's hysterical foaming-at-the-mouth piece failed to mention in detail is that one of the main reasons the law was struck down is because (for whatever reason) the law applied to individuals and not to households, while other tax laws apply to households. So the constitutional court deemed the law to be "unfair" not because the percentage was t ...[text shortened]... ot happen. As it did not happen for the 50-odd years when the top rate was 70%+ in the US.

Originally posted by sh76
While I think that a 75% marginal tax rate is a terrible idea because 75% (before other use taxes) is such a high number that it discourages production and encourages tax flight, I do find it bizarre that the judiciary would take it upon itself to make a decision to overturn duly passed legislation on the grounds that it is unfair to millionaires.

I don't see it as the judiciary's role to save people from their own electoral choices, however stupid.

Originally posted by KazetNagorra
What whodey's hysterical foaming-at-the-mouth piece failed to mention in detail is that one of the main reasons the law was struck down is because (for whatever reason) the law applied to individuals and not to households, while other tax laws apply to households. So the constitutional court deemed the law to be "unfair" not because the percentage was t ot happen. As it did not happen for the 50-odd years when the top rate was 70%+ in the US.

Originally posted by spruce112358
Yes, that would be much better. We don't want to see rich people living in the same household because it is a gross violation of our socialist principles! Split up, you filthy rich people!

Originally posted by whodey
Why does it matter whether it is a household or individual?

I really am trying to understand the warped thinking on the other side, won't you help me? 🙄

Originally posted by KazetNagorra
Apparently it matters in French taxation law. It doesn't make much sense to levy all income taxes on households except for one bracket. I don't think this was intentional but it's rather embarrassing for the French government that they apparently hired incompetent lawyers to draw up this law.

Originally posted by whodey
In reality, this is not an attack on redistribution at all.

Instead, it is merely a bunch of cowardice lawyers trying to give tax breaks for themselves and their friends all based upon technicalities.

I wonder how long this will last?

Originally posted by johnnylongwoody
Hoooray, Depardieu can return home and carry on
with his 5-6 bottles of wine a day.


I said in a recent post that it was a very brave move by Hollande.
Some would say suicidal. The Irish Government are very afraid
of this kind of tax. They will never introduce it.

Having said all that I do think that 75% is rather high.

Originally posted by sh76
While I think that a 75% marginal tax rate is a terrible idea because 75% (before other use taxes) is such a high number that it discourages production and encourages tax flight, I do find it bizarre that the judiciary would take it upon itself to make a decision to overturn duly passed legislation on the grounds that it is unfair to millionaires.

I don't see it as the judiciary's role to save people from their own electoral choices, however stupid.