Sarkozy Eyes 'Exile' Tax

By Editorial 15 March, 2012

With the wind in his sail as he finally takes the lead in the run up to the presidential elections, French President Nicolas Sarkozy has made further strides to rid himself of his unwanted image of ‘president of the rich’, by announcing plans to impose a tax on the country’s tax exiles.

Sarkzoy unveiled plans to ensure that those who have relocated abroad to avoid paying French taxes pay the same amount of tax as if they were in France, if they decide to keep their French nationality.

Underscoring that the measure will only apply to so-called “tax exiles” and to the taxation of wealth, President Sarkozy provided his assurances that the measure would not affect expatriates who move abroad for either professional or family reasons. Nothing will change for expatriates, he insisted, stressing that they will merely continue to pay tax in the country where they live.

Emphasizing the overarching aim of the measure, namely to link taxation and nationality, President Sarkozy noted that the same mechanism would be applied as in the US currently.

Sarkozy explained that under current plans any tax exile or individual who has left France to live abroad, with the sole aim of avoiding paying French tax, will be required to declare the amount of tax paid abroad to the French tax administration. He warned that if the amount is less than would have been due on income from capital in France, then the individual concerned will be asked to pay the difference

Denouncing the practice as “particularly scandalous”, the incumbent president fired a last warning shot by remarking that if individuals leave for fiscal reasons to avoid tax, and intend to remain French, they will be forced to pay the differential.

Tags: Individuals | Expatriates | Tax | France |


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