Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Display:

Wealth tax: What matters is that the capital and activity disappearing from France because of it exceeds the tax it would have collected.

France is consistently in the top 5 for Foreign Direct Investment, one of the most used indicators as to the attractiveness of a country for capital:

(note that UK's numbers in 2005 are inflated by the 140bn reorganisation of Shell, which was structured as a  'purchase' of Shell UK by Shell Netherlands)

For a complete picture, because I care about getting the facts straight, here's the two way numbers, on aggregate for the past 10 years:

France also has one of the biggest outflows of capital. Should this be counted under "successful internationalization of the big French corporations" , or under "capital flight"?

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Sun May 6th, 2007 at 09:42:03 AM EST
[ Parent ]
from the Financial Times:

Socialism (97-02) sure does not seem to have discouraged foreign investors.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Sun May 6th, 2007 at 10:07:56 AM EST
[ Parent ]
There is indeed investment in France, but as your figures show not enough to prevent a net outgoing of capital.

But wealth tax is as you know now paid by corporations but by individuals. I don't get the idea of discouraging wealthy individuals from staying in France with their capital, not least since the wealth tax revenue is negligible in the big picture.

When they move or don't come to France, it's not only the wealth tax they don't pay, it's also income tax. The activity they don't generate in France or that is lost when they leave France means less employment and less taxes on salary and turnover.

If the wealth tax were beneficial for a country, it's very strange indeed that almost no one else has it.

by skovgaard on Sun May 6th, 2007 at 12:55:55 PM EST
[ Parent ]
Just as you point out the 'Shell exception' for the UK; the inflow and outflow numbers have to be broken down into what are real inflows of capital vs. outflows of capital and not paper events.
by An American in London on Thu May 17th, 2007 at 06:11:09 AM EST
[ Parent ]

Display:

Occasional Series