France drops its super tax on millionaires

It was supposed to force millionaires to pay tax rates of up to 75 per cent: "Cuba without the sun," as described by a critic from the banking industry.

Paris: It was supposed to force millionaires to pay tax rates of up to 75 per cent: "Cuba without the sun," as described by a critic from the banking industry.

Socialist President Francois Hollande's super tax was rejected by a court, rewritten and ultimately netted just a sliver of its projected proceeds. It ends today and will not be renewed.

And that critic of the tax He's now Hollande's economy minister, trying mightily to undo the damage to France's image in international business circles.

The tax of 75 percent on income earned above USD 1.22 million was promoted in 2012 by the newly-elected Hollande as a symbol of a fairer policy for the middle class, a financial contribution of the wealthiest at a time of economic crisis.

But the government was never able to fully implement the measure.It was overturned by France's highest court and rewritten as a 50 percent tax paid by employers.

Faced with a stalling economy and rising unemployment, the government reversed course in 2014 with a plan to cut payroll taxes by up to USD 49 billion by 2017, hoping to boost hiring and attract more investments.

All the while, Prime Minister Manuel Valls kept repeating his new credo: "My government is pro-business". Ultimately, while the super tax affected only a small number of taxpayers, it triggered huge protests in business, sporting and artistic communities.

French actor Gerard Depardieu decried it vociferously and took Russian citizenship. Soccer clubs threatened to boycott matches for fear that 114 of their players or coaches would be taxed.The final version of the tax allowed them to minimize the burden.

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