The top income tax rate in France is 40% and French citizens pay a 19.6% VAT sales tax, yet some of the country's wealthiest individuals say they want to pay more.
"At a time when the government is asking everyone to show solidarity, we feel we must contribute," 16 of the nation's wealthiest individuals declared in an open letter published on the website of weekly magazine Le Nouvel Observateur.
The signatories included L'Oreal heiress Liliane Bettencourt, Total's Chief Executive Christophe de Margerie, Societe Generale's CEO Frédéric Oudéa and Maurice Lévy, chairman Publicis, The WSJ reports.
Unlike Warren Buffett, who's called for an overhaul of the U.S. tax code to make it more progressive, the les riches of France are only volunteering for a one-time special tax -- and a "reasonable" one at that.
Still, the letter from France's elites echoes Buffett's plea for the U.S. to stop "coddling" the super-wealth in this country. (See: Buffett Blasts Low Taxes On Billionaires, Says Congress Must Stop Coddling Them)
In the accompanying video, Henry and I discuss the developments in France with Gillian Tett, U.S. managing editor of The Financial Times.
"It's a sign of just how fast the political-economic climate is changing and also how much underlying social tensions there are, not just in the U.S.," Tett says. "If there's going to be a question of finite resources and allocating pain, there could be quite a nasty backlash against the rich."
In other words, it's probably no coincidence the open letter was published ahead of the new $16 billion austerity package announced Wednesday by French President Nicolas Sarkozy.
The pleas for higher taxes by wealthy citizens here and abroad "indicates the degree to which people recognize the severity of the problems" on sovereign balance sheets, she says. "It also indicates a degree to which people recognize the potential for a nasty backlash as these problems bite."
- Le Nouvel Observateur
- Liliane Bettencourt
- Warren Buffett