To aid their finally, barely positive economic growth, France decides to… raise taxes. Again.

posted at 5:01 pm on September 29, 2013 by Erika Johnsen

It almost seems like it was only a short time ago that France’s Socialist-with-a-capital-S government was finally starting to come to grips with the fact that the tax burden they’ve taken to imposing on their citizens has been so huge as to significantly hinder their economic growth, employment, and business competitiveness, and realizing that if they ever want to get back to a robust rate of said economic growth, job creation, and productivity, they were going to need to roll ‘em on back quite a ways.

Oh, wait — that was only a short time ago. As in, last month.

Which doesn’t quite help to adequately explain what the thought process was here. Via the WSJ:

The French government unveiled a 2014 budget Wednesday that continues to rely on higher taxes, threatening to further dent household spending power and economic growth, as well as President François Hollande’s record low popularity.

Faced with growing discontent over high taxation, Mr. Hollande’s government emphasized efforts in the budget to improve France’s public finances by curbing spending. But net new taxes are still set to increase by €3 billion, with households shouldering the greatest burden, including an increase in the sales tax.

The measures add to a tax burden that is already among the highest in Europe and are likely to weigh on the modest recovery in France, the eurozone’s second-largest economy, where households account for the largest component of gross domestic product. …

French companies and households have been hit hard by a steady increase in taxation since Mr. Hollande was elected 16 months ago. He introduced more than €7 billion ($9.3 billion) of fresh taxes after coming to power and another €20 billion in the 2013 budget, in a bid to restore France’s public finances and rein in its budget deficit.

Oddly enough, businesses don’t seem too thrilled this ‘new-and-improved’ addition to the country’s already historically high tax burden, via the Financial Times:

A senior lobbyist for a group of France’s biggest companies said the tax, in effect imposed on earnings before interest, tax, depreciation and amortisation, would especially hit manufacturers. For many companies it would cancel a large chunk of a €20bn tax credit being introduced by the government to lower France’s high labour costs. “It contradicts the government’s own policy of relaunching French industry,” he added.

Hollande’s grandiose ideas and predictions about spurring the economy onward and downsizing France’s ever-growing mountain of debt (all set to hit a whopping 95 percent of GDP next year) have so far mysteriously failed to bring about their promised results — and somehow, I’m skeptical this is going to be the pivot upon which he really starts to turn things around.


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Comments

This could be a fiendishly clever scheme to remove any and all incentive Germany might ever have to again march troops down the Chumps-Elise.

Jeddite on September 29, 2013 at 5:04 PM

Reminiscent of a snake eating it’s own tail…

DJcool on September 29, 2013 at 5:08 PM

Bon!

vityas on September 29, 2013 at 5:10 PM

Texas, another chance to lure new business.

davidk on September 29, 2013 at 5:11 PM

It’s almost as if socialism doesn’t work.

rbj on September 29, 2013 at 5:14 PM

I’m skeptical this is going to be the pivot upon which he really starts to turn things around.

…another ‘PIVOT’ prick!

KOOLAID2 on September 29, 2013 at 5:14 PM

If at first you don’t succeed,
Just raise taxes.
When you can’t have what you need,
Just raise taxes.
When you find to your distress,
That you’ve made an dreadful mess
Must I tell you? Can’t you guess?
Just raise taxes.

countrybumpkin on September 29, 2013 at 5:17 PM

Hey, it’s worked so well in the past.

Oldnuke on September 29, 2013 at 5:19 PM

Soon to be known as “The de Blasio Plan”

Robert_Paulson on September 29, 2013 at 5:22 PM

Maybe AP should cover the international stuff

DarkCurrent on September 29, 2013 at 5:27 PM

Be careful Hollande,

the muslims are gonna get pissed.

NapaConservative on September 29, 2013 at 5:28 PM

Companies in France can’t shut down no matter how bad their business is.The govt won’t let them because the workers must have a job even if there is no money to pay them.

docflash on September 29, 2013 at 5:33 PM

They deserve it. The French voted for him and it was no secret what his background was.

Johnnyreb on September 29, 2013 at 5:42 PM

I bet the french are wishing for “Le SMOD”.

NapaConservative on September 29, 2013 at 5:42 PM

Tax and spend is the Progressive Way.

JimK on September 29, 2013 at 5:48 PM

C’est stupide!

Shay on September 29, 2013 at 5:52 PM

An adviser to the Department of Homeland Security has used his Twitter profile to defend the Muslim Brotherhood while accusing Egypt’s persecuted Christian minority of inciting against Islam.

http://clashdaily.com/2013/09/oh-please-dhs-adviser-persecuted-christians-incited-muslims/

davidk on September 29, 2013 at 6:01 PM

Don’t laugh too hard at France. You know damn well this is all going to happen to us.

Dr. ZhivBlago on September 29, 2013 at 6:08 PM

David Burge ‏@iowahawkblog 3h

You know who else accuses people of terrorism for not giving them stuff? 13-year old girls. #IHATEYOUIHATEYOUIHATEYOU #SLAM

David Burge ‏@iowahawkblog 4h

Calling someone a terrorist because they won’t do what you want is like calling someone a terrorist because they won’t do what you want.

davidk on September 29, 2013 at 6:24 PM

Be careful Hollande,

the muslims are gonna get pissed.

NapaConservative on September 29, 2013 at 5:28 PM

You must have missed the memo…..they are called “Youth’s” in der Frankreich…..

and besides, they eat snails, SNAILS!!!……

RealMc on September 29, 2013 at 6:29 PM

Where is your Senator?

davidk on September 29, 2013 at 6:30 PM

My Senator is Marco Rubio and I havent heard from him and his staff since I berated and abused one of his underlings on the phone for half an hour.

Valkyriepundit on September 29, 2013 at 6:40 PM

As circle of a jerk as a Juan Williams argument.
Keep on it, France.

RovesChins on September 29, 2013 at 6:50 PM

If at first you don’t succeed,
Just raise taxes.
When you can’t have what you need,
Just raise taxes.
When you find to your distress,
That you’ve made an dreadful mess
Must I tell you? Can’t you guess?
Just raise taxes.

countrybumpkin on September 29, 2013 at 5:17 PM

Louis XVI tried that and bailouts too. Look how that worked out.

dogsoldier on September 29, 2013 at 6:54 PM

Companies in France can’t shut down no matter how bad their business is.The govt won’t let them because the workers must have a job even if there is no money to pay them.

docflash on September 29, 2013 at 5:33 PM

Yeah you know they can’t actually keep that up forever. “Accidents” will start to happen.

dogsoldier on September 29, 2013 at 6:56 PM

Maybe AP should cover the international stuff

DarkCurrent on September 29, 2013 at 5:27 PM

Your minders called. They want you to bring the coat hangers this time.

RovesChins on September 29, 2013 at 6:57 PM

You must have missed the memo…..they are called “Youth’s” in der Frankreich…..

and besides, they eat snails, SNAILS!!!……

RealMc on September 29, 2013 at 6:29 PM

Yep, in fact ‘disaffected’ yutes.

slickwillie2001 on September 29, 2013 at 7:09 PM

“There is a franc in private hands somewhere. It must be seized in the name of the Republic!”

/French logic

They really haven’t learned a damned thing since their Revolution, have they?

clear ether

eon

eon on September 29, 2013 at 7:36 PM

This could be a fiendishly clever scheme to remove any and all incentive Germany might ever have to again march troops down the Chumps-Elise.

Jeddite on September 29, 2013 at 5:04 PM

It may be a clever scheme to get the Germans to come and rescue the French from themselves.

The French Republic was founded on egalitarianism (as defined by equal outcomes), which has plagued them for over two centuries.

mankai on September 29, 2013 at 7:51 PM

Louis XVI tried that and bailouts too. Look how that worked out.

dogsoldier on September 29, 2013 at 6:54 PM

Yes but at least the world still has the L’Opéra Royal de Versailles as a result.

That has to be worth a few starving peasants, right? Well, at least Marie thought so…

Difficultas_Est_Imperium on September 29, 2013 at 8:00 PM

I can’t see any silver lining to this cloud. It’s just bad policy and it will have only bad consequences.

David Blue on September 29, 2013 at 8:09 PM

Yes but at least the world still has the L’Opéra Royal de Versailles as a result.

That has to be worth a few starving peasants, right? Well, at least Marie thought so…

Difficultas_Est_Imperium on September 29, 2013 at 8:00 PM

And the American Revolution, which Louis XVI, being a champion of Enlightenment ideals, subsidized heavily.

Marie wasn’t disdainful of staving peasants; she was a virtuous woman, but revolutionary slanders of her are still current.

It wasn’t vice or royal indifference to suffering peasants that destabilized France; it was misdirected idealism in power, exasperating inconsistencies, and an expensive foreign policy.

Sending off your armed forces to champion freedom on the far side of the world while championing unsound reforms in your own country is a game that can end badly.

David Blue on September 29, 2013 at 8:25 PM

The Minor Chastisement warned of in approved Catholic prophecy is thought to begin with civil war in France and Italy.

pannw on September 29, 2013 at 8:27 PM

Don’t laugh too hard at France. You know damn well this is all going to happen to us.

Dr. ZhivBlago on September 29, 2013 at 6:08 PM

1. Maybe, but only after it has happened to the countries in the EU. Their straws are waiting to fall on our camel back. It will be hard to survive, but we will. We have 10-12 years of playing out this cycle.

1. Laughing at the French is an American tradition. It’s one of the few left, so cool it.

Meremortal on September 29, 2013 at 8:35 PM

My brother was a pioneer of mini-storage in France. He told about going to meet with people about large warehouses for purchase. “How many square feet in your warehouse?”, he would ask. “We don’t know, you have to find that out,” was the response.

And that was just the beginning.

Meremortal on September 29, 2013 at 8:38 PM

Sending off your armed forces to champion freedom on the far side of the world while championing unsound reforms in your own country is a game that can end badly.

David Blue on September 29, 2013 at 8:25 PM

Good analysis. Please forward that to the White House, I think we here agree already.

Difficultas_Est_Imperium on September 29, 2013 at 8:45 PM

If at first you don’t succeed,
Just raise taxes.
When you can’t have what you need,
Just raise taxes.

countrybumpkin on September 29, 2013 at 5:17 PM

You may say this in jest – but there is way too much truth to this. Leftism (and political correctness in general) places severe cognetive limitations on the thought processes of those who believe in these ideologies. They believe that heavily centralized command economies will lead to a paradise on earth (despite the fact that such economies fail and go bankrupt wherever they are tried). This is because they are incapable of thinking outside of their (very limited) box.

Thus, a leftist who might have a high native inteligence and an elite education has less functional intelligence than an uneducated “bumpkin”.

SubmarineDoc on September 29, 2013 at 8:48 PM

Good analysis. Please forward that to the White House, I think we here agree already.

Difficultas_Est_Imperium on September 29, 2013 at 8:45 PM

His reply: you should be thanking Me.

David Blue on September 29, 2013 at 9:15 PM

Debt at 95% of GDP? Oh would we here in America be so lucky! We’re over 100% already.

unclesmrgol on September 29, 2013 at 10:17 PM

Mais effin’ oui, y’all! L’amour le socialism!

shades_of_gasden on September 29, 2013 at 10:42 PM

Either creamy sauces cause brain damage in politicians, or the French government is subtly lobbying for roles as the bad guys in the last part of “Atlas Shrugged.” As for businesses not being able to legally close–until they close the borders I can see a thriving tradition of businesses with locked doors when the few remaining customers arrive in the morning and signs reading “Gone to USA/UK/Russia/fill in the blank–you’re on your own.” Which the government and France as a whole will richly deserve for this totalitarian BS.

M. Scott Eiland on September 29, 2013 at 10:54 PM

1. Maybe, but only after it has happened to the countries in the EU. Their straws are waiting to fall on our camel back. It will be hard to survive, but we will. We have 10-12 years of playing out this cycle.

Meremortal on September 29, 2013 at 8:35 PM

We will? Wow, talk about being comfortably numb. Guess you and some others haven’t been keeping track of all the businesses shutting down, the layoffs, the increasing debt, QE infinite…

1. Laughing at the French is an American tradition. It’s one of the few left, so cool it.

No, it’s ignorant and won’t ward off disaster like some kind of talisman. So when we’re trying to figure out where our next meal is coming from, or how to keep what we have from being looted we’ll tell some French jokes. Got it!

Dr. ZhivBlago on September 29, 2013 at 11:35 PM

So when we’re trying to figure out where our next meal is coming from, or how to keep what we have from being looted we’ll tell some French jokes.

Dr. ZhivBlago on September 29, 2013 at 11:35 PM

That is going to be a very ugly time that will make the Reign of Terror look like the good ol’ days.
I wonder where the politicians who caused it will run to. Not to mention the Hollywood elite and the media celebrities who aided and abetted the country’s demise.

justltl on September 30, 2013 at 12:56 AM

*facepalm*

Othniel on September 30, 2013 at 3:43 AM

Sending off your armed forces to champion freedom on the far side of the world while championing unsound reforms in your own country is a game that can end badly.

David Blue on September 29, 2013 at 8:25 PM

Agreed. Sending this to the genius in the white house is probably pointless since he knows all about history n’ stuff.

dogsoldier on September 30, 2013 at 5:17 AM

1. Laughing at the French is an American tradition. It’s one of the few left, so cool it.

Meremortal on September 29, 2013 at 8:35 PM

I don’t laugh at the French too much.
1) They built my favorite cars.
2) They had my country’s back during the Revolutionary War.

Yes, we pulled their bacon out of the fire during two world wars. We didn’t have much choice after those beautiful engraved invitations from Germany.

BillH on September 30, 2013 at 9:06 AM