We need your help now
Support from readers like you keeps The Journal open.
You are visiting us because we have something you value. Independent, unbiased news that tells the truth. Advertising revenue goes some way to support our mission, but this year it has not been enough.
If you've seen value in our reporting, please contribute what you can, so we can continue to produce accurate and meaningful journalism. For everyone who needs it.
Sign in. It’s quick, free and it’s up to you.
An account is an optional way to support the work we do. Find out more.
By continuing, you are indicating that you accept our Terms of Service and Privacy Policy.
SINN FÉIN’S PROPOSALS to introduce a third income tax bracket and a wealth tax have been compared by some to Francois Hollande’s pre-election promises in France.
Fine Gael’s Dara Murphy for example said that Sinn Féin’s plans were “tried with disastrous consequences” by the French President. So, are the two plans comparable and were Hollande’s plans a disaster?
Firstly for clarity, the term ‘wealth tax’ relates to a tax on assets and should not be confused with Hollande’s controversial 75% income tax election pledge.
Wealth tax
Apart from a couple of years break, France has had a wealth tax of some form or another since the early 1980s. Paris currently imposes six different rates of wealth tax on total assets between €800,000 and €10 million.
For example, individuals with assets of €1.3 million have an annual charge of 0.5% while those above €10 million pay 1.5%.
Non-residents in France are also liable for wealth tax on assets physically situated in France and co-habiting couples must make also make a joint wealth tax submission. Assets held by children below 18 years of age must also included.
Sinn Féin’s 2014 Pre-Budget Submission says that their proposals are modeled on the French and Norweigan levies. They are roughly in line with the French rates, proposing a flat 1% tax on net wealth in excess of €1 million excluding “working farmland, business assets, 20 per cent of the family home and pension pots”.
Unlike Sinn Féin’s proposals, the French wealth tax rules do not have an exception for a portion of the family home. Principal and secondary residences as well as rental properties are included in the calculations, demonstrating how property valuation is the primary constituent in France and indeed elsewhere in Europe.
Financial investments including stocks and shares are included when calculating wealth, as are bank accounts, jewellery, furniture, cars, motorcycles, boats and aeroplanes.
All borrowings undertaken to finance the purchase of a taxable asset are excluded from the wealth tax calculations in France. For example, if Person A has a financial wealth of €800,000 and a home worth €1 million their taxable assets are €1.8 million.
However, if they borrowed €600,000 to purchase the home and at the beginning of a tax year they still have €300,000 left to pay on the loan, their taxable assets are €1.5 million.
€1,800,000 – €300,000 = €1,500,000
Similarly, Sinn Féin’s proposals are net of all liabilities including mortgages and other debts.
Higher income tax rate
But likely where the comparisons have come from are as a result of the much reported 75% higher income tax rate that was a key part of Francois Hollande’s 2012 election campaign.
This is the proposal that saw Gerard Depardieu take up residency in Russia and drew the ire of, among others, football clubs in France who argued it would make it impossible for them to compete with other European clubs.
But brash actors and pampered footballers weren’t the only ones to have problems with the plans, France constitutional council ruled in late 2012 that the tax was illegal.
The problem was that the income tax was levied on individuals rather than households which is how things are done in France. The Government was reluctant to alter the proposals to include households because it would have greatly widened the net and hit people who weren’t origianlly intended.
But Hollande didn’t give up and managed to push through a much altered verison of the plan which instead put the obligation on companies rather than individuals. Firms are now required to pay the 75 per cent rate on salaries they pay to employees that are over €1 million annually.
But, as with the original proposal, the measure was not really designed to raise a significant amount, rather as a symbolical measure to show that higher earners were also contributing to austerity.
For example, estimates say that the measure will raise less than €1 billion this year after it’s levied in about 1,500 cases.
But perhaps this isn’t the correct comparison to be making, Sinn Féin are suggesting a new third income tax rate of 48% on income earned in excess of €100,000.
This is arguably commonplace in France in the form of a 45% rate for households with income over €151,000.
To embed this post, copy the code below on your site
I think that the minute the UK are officially out of the EU then the French will open the borders at Calais and let the UK deal with the illegal immigrants in Dover. Interesting times are ahead.
…or Roslare!!!!
Ireland is still in the EU, Michael.
Surely being the last country in Europe with English as our primary language is going to be a benefit to us?
That would be the silver lining; movement of financial services to Dublin. It all depends on how things are unravel. The U.K. may yet just replace eu law with their written law of the same substance, meaning that there wouldn’t be any changes etc for foreign companies etc.
You can’t be bombarding your country with immigrants you can’t afford, demanding wars your people want no part of, forcing theough laws that don’t benefit the people and doing it all with all with a healthy condescending disrespect for that countrirs citzens. Thank God the Brits didn’t swallow the media’s scaremongering, believe its biased polls or were in anyway shape or form influenced by eejits like Enda Kenny and other EU pimps. The UK told the EU to go fk itself and it is just sooo beautiful. They will have no choice now but to listen to her citizens, reform its Orwellian bureaucratic conditions, etc. Maybe this is the stepping stone needed for our very own exit. Interesting times ahead.
Not to worry, ask them to vote again. I don’t think they really meant it.
Like to see the EU try that over there, Cameron would be pulled from number 10 and beaten in the streets if they tried it. Amazing result but there is a losing bonus point for the remain side with there being no reason for UKIP to exist after it is fully implemented.
Enda off to the states to canvass for Clinton !!!!!
End a said there were 1.2 billion Irish living in the UK. If only they had listened to him
Cameron is f********cked…. Watch him resign over this.
I think he was resigning anyway. But opposition and Boris had asked him to stay on
Borris wants him to stay believe it or not. Kinda like saying “here’s a bed of knives I’m made, would you mind sleeping in it?”
Cameron has just resigned. Hardly a surprise.
Seems likely that Corbyn will leave too. Core labour areas voting leave suggests he wasn’t getting through. He was very absent throughout…
Fair play to them, all this cowardice and hyperbole is manure.
It behooves the EU and Britain to hammer out a good deal that avoids any major ructions as Britain is simply too big an ecenomy for Brussels to play hard ball on their own doorstep.
Watch the fear campaign turn out to be just that.
The British have shown the courage to set their own future, they will be laughing at us this time in 10 years.
The knock on effect of other countries wanting to leave will be huge. If this happens, the euro will collapse and the sterling won’t be as weak as people think. May be a wise move from Britain to get out before the whole euro falls apart.
All ready calls in France and Holland for referendums on exiting.
If you take the second(Britain) and a possibility of the third(France) strongest economies out of EU, then you’ve got a fairly shakey union.
On the flip side the import/export business for the bigger economies in the EU could get a massive boost
Trevor – Britain isn’t in the Euro. The Euro has gained massively against sterling this morning.
Never said they were Brinster. My point being that if you take an economy/contributor like Britain out of the union, it makes it less stable. The gains this morning are just a knee jerk reaction. When this settles the markets will react, and already the strerling/euro is trading about .81, which isn’t the plumet they were expecting.
Goodbye EU, Hello IMF.
Well the result is not a surprise. Back in the day my parents voted to join the EEC I do wonder if they would have voted yes to the EU.
Wait 1 year. After that no nation will ever think about leaving again. While many may think that the EU is bad, its the complete opposite. If you saw Europe before the EU you would know. Ireland being a prime example. We were a ‘developing’ nation before we joined the EU and look at us now! A large part of that is due to the EU, in forms of trade, funding and an influx of trained professionals.
If you try to say we owe the banks money then that is our own politicians fault, not the EUs (as they were the ones who caused the mess). But the EU gave us a loan to bail out our mistakes at an intrest rate of less than that of inflation, meaning we pay back less than we borrow. While the bailout was terrible, the other option was to close the banks and everyones savings would have disappeared and debts be sold off. (Look at history if thats something you dont believe)
The EU makes trade so easy, something that will drastically affect Britain now that they are out. We will see their exports and imports drop immensly over the next few months. And more importantly, we will see all major companies who have EU headquarters in Britain relocate to Ireland, making an immense boost to our income and employment.
So in terms of Ireland, Brexit is a plus for us!
Could they not set up their own union consisting of members and previous members of the commonwealth such as ourselves , India , Australia? Canada and Australia seem to do fine on their own, why couldn’t UK do the same? They’ve taken back total control of their country , I say fair play. Would love to see Ireland have the balls to do the same!!
I completely agree, but I think our exports to the UK expose a lot of Irish businesses.
Now? Boris at No. 10 and Gove next door.
Looks like Cameron has a mullet in that photo!!!!!
I was 50/50 on Brexit. I must say i am quite pleased they voted to exit. Fair play to the Brits. Brave move….. Interesting times ahead
I haven’t forgotten this. Delighted https://www.theguardian.com/world/2011/nov/06/greece-george-papandreou
How can one be 50/50 on Brexit and be happy then with Brexit.
BRITS OUT ! ! !
the EU started without Britain, and will be able to continue without. in fact it is likely that GB will fall apart over thi, should Scotland decide to go their own way. at last, we can make decisions I Europe, without having to come up with special treatment for GB any longer.
2 years…. Ah jeasus what’s all the fuss about so
Newstalk and the Irish Media had been pushing “the remain” vote anyone who disagreed was a racist!
Im glad the UK citizens have given the political class the two fingers.
The Irish gov holding an emergency meeting at 10. What’s the number one topic to discuss, the value of pensions!!!!! Unbelievable!
Listen they tried this with religion when they didn’t get their own way, that worked out fairly rubbish in the grand scheme of the world, but they still seem happy with it. Idiots! Won’t have to worry about foreigners coming in taking their jobs now, their won’t be any and if there are the locals will be too dumb to do them if this is the way they voted! Bit shocked waking up to that.
I never took a side in this one. It didn’t seem to have the vicious rivalry that normally comes out of these things but then again I didn’t pay much attention. Will be interesting to see if it’s the start of a domino set.
The English in these present times have shown they carry larger balls than than our own “conservative politicians and voting public”. I never thought I would admit to this. Doubt there will be much change here. A few more cars and housing appliances on H.P. should keep the ball rolling for the pseudo well off after all one should never leave the side down should one? I heard lately from a reliable source that the owners of a house in an upmarket part of Cork exclaimed to a bank manager to take the house and they would remain as tenants. Here’s the crutch they also asked to be left with the mark 1 Mercedes and the SUV on the drive as status emblems presumably. This country seems to have been embellished by a materialistic trance. A case of eyes wide shut for the coming times? Our government’s has vehemently lied time over time through back hand deeds etc. It seems we are left with nation that has not got the balls to upset the status quo, whatever be the weather.
BE SMART AND BECOME RICH IN LESS THAN 3DAYS….It all depends on how fast you can be to get the new PROGRAMMED blank ATM card that is capable of hacking into any ATM machine,anywhere in the world. I got to know about this BLANK ATM CARD when I was searching for job online about l 5days ago ..It has really changed my life for good and now I can say I’m rich and I can never be poor again. The least money I get $2,000 daily and now i have $10,000… Everyday I keeping pumping money into my account. Though is illegal,there is no risk of being caught ,because it has been programmed in such a way that it is not traceable,it also has a technique that makes it impossible for the CCTVs to detect you..For details on how to get yours today, email the hackers on : (cindytedder767@yahoo.com) Tell your loved once too, and start to live large. That’s the simple testimony of how my life changed for good…Love you all …the email address again is (cindytedder767@yahoo.com)
have your say