Sales Tax Hike in France Sparks Protest
Groups say President Hollande broke his promise to tax the wealthy. Instead, he’s increased sales taxes which adversely affect the working class.
JESSICA DESVARIEUX, TRNN PRODUCER: Welcome to The Real News Network. I’m Jessica Desvarieux in Baltimore.
On December 1, a demonstration calling for a fiscal revolution will take place in Paris. Protesters are rallying against an increase in taxes, including a VAT sales tax hike that will go into effect on New Year’s Day. They’ll also be protesting tax breaks to corporations and cuts to public services.
With us to discuss the event is Raquel Garrido. She’s a lawyer and international spokeswoman for Parti de Gauche, also known as the Left Front, which is one of the groups organizing the event.
Thanks for joining us, Raquel.
RAQUEL GARRIDO, INTERNATIONAL SPOKESPERSON, PARTI DE GAUCHE: Thanks for the invitation.
DESVARIEUX: So, Raquel, please tell us about the March on December 1. Exactly who will be participating? And who do these tax increases directly impact?
GARRIDO: Well, there is–the initiative comes from Jean-Luc Mélenchon, who was a presidential candidate for the the Left Front and copresident of the Parti de Gauche you mentioned, the Left Party. But it’s rallying much wider around trade unions, NGOs, around consumer rights, and just, you know, your plain population from the, I would say, far left spectrum, but also the socialists, because what we call here, I mean, in France, a socialist, which is a social democrat, and the people that voted for so long because the policies that are currently being implemented are not what they were expecting.
DESVARIEUX: When you say that, what do you mean? Why is there this gap?
GARRIDO: Well, first of all, the left traditionally uses taxes to redistribute income. That’s the reason why taxes exist [inaud.] puts some fairness in society, less differences.
But the thing is that with this government what’s happening is that taxes are used to take money from folk, from the ordinary people, and giving it to the banks, while the banks, because of the consequences after the subprime crisis in the United States that was imported into the European Union because of the freedom of circulation of capital, the big money losses in the banking sector were transferred to the public sector. And so that money has to, you know, be covered by someone.
So what’s happening today all across Europe and all across the eurozone is that we have austerity plans, austerity measures. And those measures, what they do is that they take money from ordinary people and give it directly in payment of debt, which is the financial sector and banks.
DESVARIEUX: Let’s talk about an example, a specific example of one of these tax increases and how it’s going to disproportionately affect working people.
GARRIDO: Well, for instance, the VAT tax, which is coming into force on New Year’s, is typically your most unfair tax, because it’s flat and it concerns everyone in the same manner, whether you’re very wealthy or not. Typically, the left, what we defend is income tax, which is with different rates. We think that you would have and you should have different rates according to your income. And so the poorer people should pay zero or near or close to zero income tax, but the very wealthy should be paying, I mean, almost 100 over a certain amount. We like to refer to what Roosevelt did in his time in the United States when he decided that no one should be earning more than $1 million a year, and then every dollar over that was taxed at, I think, 90 percent.
DESVARIEUX: So are you guys calling for the exact same thing? Would you said that that would be a fair tax?
GARRIDO: Yes. Our proposal was to have 14 different rates, so that it would be very progressive, very fair. But our last rate, effectively we were suggesting a 100 percent rate or near 100 percent over €360,000. We think that €30,000 a month is alright.
DESVARIEUX: Raquel, I’m going to present the counterargument, because you often hear the argument that raising taxes on the wealthy is going to create this flight. They’re essentially going to leave France. And I can’t help but think of Gérard Dépardieu, the French actor, and how he’s now a Russian citizen, and he’s sort of been in this heated debate over the wealthy, essentially, tax exiles, you know, leaving France. What do you make of that argument?
GARRIDO: Well, first of all, it’s not true. I mean, the wealthy are in France very much. France is one of the places on earth where you will find the most millionaires, ’cause there’s lots of money to make here, because of the social model, because people still have welfare, because you have retirement measures. I mean, the amount of people that actually go into absolute poorness when there’s crisis is lower. Right? So there’s money to make for businesses. And there’s also a great, you know, way of life. And so there’s not so many Rivieras in the world. So the–and Paris is Paris.
So it’s not true that the wealthy leave, because there’s still money to make here, and it’s good–France is good business. And even Gérard Dépardieu, he’s shooting movies in France still today. I think he’s actually paying taxes in France. And there was a very mediatic, you know, use of his declarations, but I think he’s actually–he still has, you know, money here and he’s paying taxes.
And one thing, though, that the Gérard Dépardieu situation was useful for is that what we were saying at the time is that even if you leave France, you should be–if you’re still French, if you’re French, you should pay taxes in France. And that’s what the United States does. The United States has a foreign account tax measure. And when you’re–if you’re American and you’re living in France, you have to declare your income. And if what you would pay in the United States is higher than what you’re actually paying where you are, then you have to pay the difference. That exists in the United States. I don’t know why we French wouldn’t be able to do the same thing.
DESVARIEUX: Alright. Raquel Garrido, nice to see you. And thank you for joining us.
GARRIDO: Thank you for the invitation.
DESVARIEUX: Thank you for joining us on The Real News Network.
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