Monday, June 18, 2007

Tax proposals in France

(8 Jun) Ségolène Royal, was on France Inter's 'Inter-activ'. She returned to the point that she had a short time to prepare, from being designated as candidate until the presidential election, compared to the 5 years Nicolas Sarkozy had.
Policy was decided before the candidate was chosen. It is necessary to accept the "logic of 5th Republic" - of having a strong leader, a leader who is not stifled by the party, rather a party that supports the leader, she said.

The interview also clarified certain points that I may not have fully understood before:
70% of estates are already exempt from inheritance tax: this would pass to 90% under Sarkozy's proposals.
The bouclier fiscale (tax cap) benefits only the 15,000 richest taxpayers.
The government also proposes to exempt interest on prime residences from tax. Ségolène is not opposed to this, but warns that increase in costs and property prices could wipe out any benefits. Controlling them would run counter to liberalism, she said.
But the major point of discussion as far as economic / fiscal proposals has been the TVA sociale, that is increases in Value Added Tax : the new Prime Minister, François Fillon, has described this as a TVA anti-délocalisation (against job-losses to abroad). This is not necessarily a bad thing, as has been shown in Germany, since VAT is imposed on imports, in contrast to taxes and other charges on income.  But the PS have been able to portray it as a means of financing tax cuts for the better-off.

Update (17 Jun). I'm listening to the radio: the Socialists seem to have done relatively well. The BBC WS reports that initial results show the UMP with 328 seats, the PS 206. By midnight, the final results are in. It's looking even better:  UMP 314, PS 218. So, 40 seats gained by the Socialists from the UMP (compared to 2002). Also, Alain Juppé, who was going to be number 2 in the new government has been defeated. There is no constitutional reason why this should bar him from office (in fact, ministers have to resign their seats anyway), but Sarkozy has said that anyone who stands for election and is defeated cannot be part of the government (- see the FT, 9 Jun).

At 7:00, I heard that Royal and Hollande had split up as a couple: France Inter had just had aired their exclusive interview with Ségolène Royal. The news had been released the previous evening by a press agency, it seems. When the BBC reported the story, they said, rather brutally, that she had accused him of having affairs. In the extract from the interview that I heard, she said that he could carry out his vie sentimentale elsewhere (vie sentimentale = love life).

Correction (19 Jun). After listening to the whole of Ségolène's latest interview, she does not actually mention there anything about the vie sentimentale. But it is supposed to be in a book that was due to come out on Wednesday. Le Monde had this: "J'ai demandé à François Hollande de quitter le domicile, de vivre son histoire sentimentale de son côté..." A download of the interview is available here.

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