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France’s ‘Culture’ of High Taxes



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According to polling data just released from Pew, the French people supports spending cuts over spending increases by a margin of 81-18. But that does deter the French government, which as I  mentioned a few weeks ago, only seem capable of raising taxes. Case in point: the latest idea from François Hollande’s government is to implement new taxes on technology giants such as Apple and Google in order to finance cultural projects. That makes now a good time to remind readers that France has a Minister of Culture and believes in a “right to culture” (which is an odd focus when the French economy has been struggling with high unemployment rates for a large part of the last 30 years). It also believe in the “exception culturelle,” meaning that cultural products are treated differently than other goods, which is how you get these kinds of policies:

In a trenchant defence of France’s “exception culturelle” in the digital age, the report proposed imposing a tax of up to 4 per cent on the sale of all devices, including gaming consoles and ereaders, that allow access via the internet to “cultural content”.

“Companies that make these tablets must, in a minor way, be made to contribute part of the revenue from their sales to help creators,” said Aurélie Filippetti, culture minister. The new tax could be included in next year’s budget, she added.

The report said it was legitimate for the authorities to intervene to “correct excessive imbalances” in the digital economy. “They can use taxation to make actors that don’t directly exploit content, but which profit from its circulation, contribute to its creation.” [...]

Mr Hollande, who has insisted “l’exception culturelle” must be excluded from forthcoming trade negotiations between the EU and the US, said in a statement welcoming the Lescure report that he was “fundamentally attached to the defence” of French culture.

Ms Filippetti said a smartphone tax would be at a “very low level”. The report said it would have to be kept low to avoid punishing consumers and provoking a black market. It said an initial tax of 1 per cent would raise €86m, but this could be raised to 3 or 4 per cent. It pointed out that it would not hit jobs in France as the companies affected employed few people in the country.

The whole piece, from the Financial Times, is here. I suspect that, under the cover of funding French culture, the Hollande government is mostly catering to its crony friends in the French film and music industries.

With a single minded focus on raising taxes at every turn, Hollande shouldn’t be surprised by this recent French poll: 50 percent of 18- to 24-year-olds and 51 percent of 25- to 34-year-olds would, if they could, like to leave France for another country, many of them for tax reasons.

In fact, meet Clara G, a 20-year-old and second-year history student at the Sorbonne. She recently published an open letter to Hollande in the French paper Le Point. If your French permits, read the whole letter. Luckily, The American Interest has translated some of  her letter:

I don’t want to work all my life in order to pay taxes that will, for the most part, only go to service the 1,900 billion euros of debt that your generation was kind enough to leave as your legacy. If these loans had at least been invested in a plan for the future of the country, if I thought I would profit a little from them, I wouldn’t have any problems repaying them. But they only allowed your generation to live above its means, to secure a generous welfare that I won’t be able to enjoy. In order to make your lives, I would say “cushy”, but I’m afraid that the word offends you.

My work and my taxes will also have to pay your pension that you haven’t bothered to fund, as well as all the health care and welfare costs for all these elderly people who will be, in less than twenty years, the majority in the country. Will this leave me enough money to live well and raise my children? A few days ago, I read a study by economist Patrick Artus that sent shivers down my spine: “With the low potential growth and given the aging population,” he writes, “young French have the prospect of undergoing continuous stagnation of their purchasing power during their working lives.” You must admit that it this is not a very gratifying life prospect. 

But the most depressing thing is what my life will be like if I stay in France. Once I graduate, with my beautiful useless diplomas, I will without doubt first join the large ranks of unemployed youth before spending several years in internships and the CDD [temporary work contracts]. I am, as I believe the experts say, the “adjustment variable” of a labor market that has deliberately chosen to exclude young people to protect the workers of the CDI [permanent work contracts] already in place. With such insecure and poorly paid jobs, I won’t be able to convince a bank to give me a home loan to buy an apartment in Paris. And if, by some sort of improbable miracle, I go on to earn lots of money, I know in advance that not only would I have to pay taxes, but it would also earn me the reproaches of my fellow countrymen and your personal contempt.

To be fair, Hollande is not the only president of France responsible for this mess. They all are, including Nicolas Sarkozy, a champion taxman and a big spender in his own right. However, it is as if Hollande is now fervently working to speed up France’s destruction. 

Sadly, France isn’t the only country that abuses the younger generations for the benefits of seniors alone. Most countries do – including the U.S.



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