Yesterday, the exorbitant 75% payroll tax was killed off quietly by the French government.
In a shock to no one with any sense, the tax failed to raise “significant revenue” and was accused of driving people who earn large incomes away from France.
The tax raised only €420 million ($505.8 million) in 2013 and 2014 combined, less than 0.5% of France’s current budget deficit. It expires at the end of this month and won’t be renewed, as the government tries to take a more business-friendly approach.
Although French President Francios Hollande campaigned in 2012 on the 75% tax rate, earlier last year he “reshuffled” his cabinet as part of a new pro-business drive.
The French economy is in deep trouble. France’s major statistical agency is projecting growth at just 0.3% in the first half of the year. This level of slow growth indicates that unemployment levels will not be dropping anytime soon. France’s unemployment rate recently rose to 10.4%.