Mon Dieu!
Is Gerard Depardieu bailing on France over taxes? It appears so. A French newspaper, Le Journal du Dimanche, published an open letter attributed to Depardieu in which he traded barbs with Prime Minister Jean-Marc Ayrault over the move. Depardieu had previously announced that he had moved to Belgium in order to escape France’s high tax burden, a move that the Prime Minister publicly denounced as “quite shabby.” Ayrault went on to suggest that Depardieu was unpatriotic, saying, “Paying a tax is an act of solidarity, a patriotic act.”
Depardieu fired back, claiming, “I leave after paying 85 percent of my revenue in 2012.” He appeared to then renounce his citizenship, saying, “Je rends mon passeport” (“I give you my passport.”)
The exchange was quite the sensation in France – and in the United States, where our country is struggling with the notion of taxing our high income taxpayers at increased rates. It has been suggested that, as rates go up, our millionaires, too, will flee for tax friendly countries like Belgium and Ireland.
However, is it, perhaps much ado about nothing?
The French newspaper, Le Monde, suggests that Depardieu’s tax calculation might be overstated, noting that, even in tax-heavy France:
“Payer 85 % d’impôt sur le revenu est impossible“(“To pay 85% tax on income is impossible.”)
In fact, as in the U.S., those in the top tax brackets don’t pay tax at that rate across the board. In France, as in the U.S., the income tax system is progressive which means that all taxpayers pay the same tax rates for the same levels of income. Depardieu would, then, pay 0% on the first € 5963 of income, as would his fellow countrymen. He would pay 5% on income from € 5,963 to € 11,896, as would his countrymen, up to a maximum of 41% for income exceeding € 70,830 ($93,359.28 U.S.).
And that infamous 75% tax on the highest wage earners in France alluded to in the press? It’s not yet in force.
Le Monde figures that, for 2012 Depardieu would have had to pay € 787,350 ($1,038,036.55 U.S.), assuming zero deductions. That works out to an average tax rate of 39.4%, less than half of what Depardieu claims. The paper goes on to suggest that, even including other non-income taxes, the tax rate Depardieu claims to have paid is preposterous.
Nonetheless, Depardieu has steadfastly defended the move to his new home in the Belgian village of Nechin. He joins other wealthy French exiles there who also have moved to avoid paying higher taxes.
Interestingly, while Belgium and Switzerland are at the top of the list for new homes for lower taxes, those countries aren’t the only nations benefiting from France’s tax burden. In addition to those countries, the French are considering moving to the U.S. for lower taxes. Yes, you read that correctly: the U.S. Specifically, the French are touting the advantages of low tax states in the U.S., such as Florida. Le Journal du Dimanche notes that, “A Miami, les taux d’imposition sont très faibles.” (“In Miami, tax rates are very low.”)
And even as rates go up, some French citizens are returning to the country: it seems that even the lure of lower taxes cannot erase the sense of loss of one’s homeland. Author and filmmaker Michel Houellebecq returned to France because he missed speaking in his native tongue. And former pro tennis player (and now, entertainer) Yannick Noah came back to his homeland, with a new belief a la Warren Buffett, “Il me semble naturel que ceux qui doivent faire le plus d’efforts sont ceux qui ont le plus de chance” (roughly “It seems natural that those who must make the greatest efforts are those that have the most opportunity.”)
Depardieu, however, believes otherwise.
The actor is perhaps best known in the U.S., ironically, for his role in the movie, Green Card, co-starring Andie MacDowell. In the flick, Depardieu’s character fakes a marriage in order to remain in the U.S. Spoiler alert: in the end, he goes back home – to France.
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