The Constitutional Council of France has approved President Francois Hollande’s proposed plan to impose 75% tax on all salaries exceeding 1m.
As per the proposal, employers will have to pay 50% tax on salaries that are more than 1m, including other taxes and social charges, the rate will effectively stand at 75%.
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Capped at 5% of the company’s revenues, the tax is applicable for wages paid in 2013 and 2014, prior to lapse in 2015.
In a ruling, the constitutional court said that it examined the tax following oppositions from over 60 parliament members and 60 senators over the proposal.
The ‘millionaire tax’ was announced by Hollande in February 2012 as part of election campaign.
In December 2012, the court opposed the tax proposal as it was applied to individuals and not households.
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By GlobalData
