Taxing the rich could help cover increased French defence spending

In France, super-rich people could be be forced to pay more taxes as the country seeks to boost its military spending.

The current cabinet is looking at ways of dusting off plans from the previously failed government to tax the super-rich, according to the Minister of the Economy, Finance and Industry – Éric Lombard.

“Those with significant savings must contribute by paying more taxes,” said Lombard in an interview on FranceInfo on Tuesday, referring to wealthy individuals who dodge higher taxes.

“We wish to make this tax permanent but make sure it’s above all a contribution that fights against what we call fiscal over-optimization,” he said.

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The minister also talked about how the government is looking at ways to mobilise investors and set up defence-focused investment funds for private investors.

The French government has plans to increase its defence budget by €3 billion a year until 2030.

However, the country has been struggling with a high budget deficit and mounting debt, reaching some €3.3 trillion.

“Annually we pay more than €50bn euros to our creditors, more or less the defence budget,” said the minister.

“We will have to make more efforts [to increase defence budgets],” warned Lombard, but he promised that this would not mean cutting back on social spending.

Taxing the rich is a hot topic in France

The National Assembly, the lower house of the French parliament voted in favour of a 2% wealth tax on the assets of the super-rich nearly two weeks ago.

Although there are very serious doubts that this bill would be accepted by the Senate, it nevertheless appeared as a significant milestone.

The bill targeted those individuals with a net worth exceeding €100 million, and it is expected to yield between €15bn-€25bn a year for the budget.