France's "millionaire tax" of 75 percent has been approved
by the nation's Constitutional Court, giving French President Francois Hollande the green light to implement his progressive economic policy.
The temporary 75 percent tax was announced by the French president back in November 2012 as part of his tax reform platform, appealing to his socialist base, Bloomberg News reported, noting that Hollande once said he "didn’t like" the rich
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Hollande's tax reform was initially intended to be only for individuals, but was later extended to companies as well. The increase in taxes was an attempt by Hollande to shrink its massive budget deficit and support the sagging economy, CNN Money reported
"The companies that pay out remuneration above 1 million euros will, as expected, be called upon for an effort of solidarity on remuneration paid in 2013 and 2014," the Economy Ministry said in an emailed statement.
The decision by France's Constitutional Court to allow the measure comes one year after the same court ruled against it. In December of 2012, the French court found that the tax wasn’t acceptable
because it applied to individuals, when French income taxes are generally based on household revenue.
The bill was then redrafted by Hollande's government to levy a temporary 75 percent sales tax on annual earnings of 1 million euros, Forbes reported
The new tax levy on the nation's most wealthy citizens, which Forbes estimates affects 8,000 households, had been met with disdain by some of the nation's most prominent figures, including famous French actor Gérard Depardieu. In February of this year, he acquired a permanent address in Russia
to avoid the tax.
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Additionally, 63-year-old Bernard Arnault, the country's most well-off citizen
, reportedly began the process of applying for a Belgian passport, shortly after Hollande's victory over former President Nicolas Sarkozy last May.
The billionaire Frenchman heads LVMH, a Paris-based multinational luxury goods conglomerate known for such brands as Louis Vuitton, Moët, Christian Dior and Hennessy. According to Forbes magazine, Arnault is the 4th richest man in the world, with a net worth of approximately $41 billion.
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