Blow for French president Hollande as court throws out plans for 75% supertax on wealthy
Stinging rebuke to one of Socialist leHollande's flagship campaign promisesHis largely symbolic measure was intended to hit incomes over 820,000But would have brought in just 250m – compared to France's 70bn deficit
14:47 GMT, 30 December 2012
French President Francois Hollande suffered a fresh setback yesterday when his country's highest court threw out a plan to tax the ultra-wealthy at a 75 per cent rate and said it was unfair.
In a stinging rebuke to one of under-fire Socialist Hollande's flagship campaign promises, the constitutional council ruled that the way the highly contentious tax was designed was unconstitutional.
It was intended to hit incomes over €1million (820,000) but the largely symbolic measure would have only hit a tiny number of taxpayers and brought in up to around €300million (250million).
Embattled: French President Francois Hollande suffered a fresh setback yesterday when France's highest court threw out a plan to tax the ultra-wealthy at a 75 per cent rate and said it was unfair
It was an insignificant amount in the context of France's roughly €85billion (70billion) deficit.
Au revoir: Actor Gerard Depardieu recently announced his intention to turn in his French passport and move to a village in a tax-friendly Belgium
Prime Minister Jean-Marc Ayrault was quick to respond, saying in a statement following the decision that the Government would resubmit the measure to take the court's concerns into account.
The court's ruling took issue not with the size of the tax, but with the way it discriminated between households depending on how incomes were distributed among its members.
A household with two earners each making under €1million (820,000) would be exempt from the tax, while one with one earner making €1.2million (980,000) would have to pay.
The French Government approved the tax in its most recent budget, amid criticism that it would do little to stem the country's mounting fiscal problems and would drive away the wealthiest citizens.
Meanwhile President Hollande's popularity has been tanking as the country's unemployment continued its rise for the 19th straight month.
France's most famous actor Gerard Depardieu recently announced his intention to turn in his French passport and move to a village in a tax-friendly Belgium.