9/09/2012

France's richest man moves to Belgium, coincidence?

Is it just a coincidence that Bernard Arnault, France's richest man and chief executive of luxury group LVMH, is moving to France at the same time that the country is increasing its top tax rate to 75 percent?  Arnault says that his move was not triggered by the tax hike.  Note though that he just happened to make a similar move during the last Socialist presidency, though that time he moved to the US.
. . . Arnault, who emigrated to the United States during the last Socialist presidency in 1981, has been critical of Hollande's tax initiative, telling Prime Minister Jean-Marc Ayrault on Wednesday he opposed the move.
But he was not becoming Belgian to cut his tax bill, he said.
"Contrary to information published today, Bernard Arnault clarifies that he is and will continue to be a fiscal resident in France. His possible acquisition of Belgian nationality will not change this situation or his determination to develop LVMH and create jobs in France," he said.
Arnault is ranked as the world's fourth richest man with a total wealth of $41 billion, according to Forbes magazine. In a year, he jumped from seventh position, benefiting from his company's rising sales in Asia. . . .
The Financial Times reports that even Mr. Hollande's government recognizes that incentives matter.  More bizarrely they are exempting sports and movie stars.  Might they think that sports and movie stars are the most mobile?
French business leaders have stepped up the pressure in recent weeks on Mr Hollande to limit the tax, fearing an exodus of top earners and a drought of foreign investors and managers willing to come to France. 
On Wednesday, Bernard Arnault, France’s richest man and head of the luxury goods group LVMH, met Jean-Marc Ayrault, the prime minister, for talks in which he was reported to have discussed the impact of the government’s tax plans
Responding to business concerns, Pierre Moscovici, the finance minister, said last week that the 75 per cent levy would be introduced in “an intelligent manner” to avoid prompting an exodus of high earners
The websites of the newspapers Les Echos and Le Figaro reported yesterday that the 75 per cent rate would include other marginal taxes that would in effect render the new rate at 67 per cent. They said it would be limited to salary, with sports and other professional stars able to avoid the tax. . . . 

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