French court approves new ‘millionaire tax’ on the wealthy

France’s constitutional court has approved a controversial “millionaire tax” proposed by the country’s president that will levy taxes on companies that pay salaries north of 1 million euros (just under $1.4 million).

Under President François Hollande’s proposal, businesses will be required to pay 50% taxes on wages above the threshold for 2013 and 2014. The new tax, combined with already existing charges levied, amounts to about 75% of salaries above the cutoff mark.

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The measure falls in line of Hollande’s campaign promises to push France’s wealthy to extend a bigger hand to help the country out of its economic slump. But the proposal has sparked the ire of companies and foreign investors who complain that France is becoming increasingly anti-business.

The well-off in France have become increasingly discontent by new taxes adopted by the country’s Socialist government headed by Hollande. Actor Gérard Depardieu, fed up with what he described as the government punishing creativity and success, gave up his French citizenship and this year became a citizen of Russia.

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Last year, France’s constitutional court rejected a 75% tax on individual workers who earned more than 1 million euros. The constitutional court said that taxes for individuals was capped at 66%.

The approved new tax will be capped at 5% of a company’s revenue. It is estimated that it will raise about 210 million euros a year.

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