Tuesday, December 18, 2012

Gerard Depardieu, France's biggest tax evader

We personally cannot identify with the feelings of Gérard Depardieu who announced he had quit Paris for a small town 800 meters (yards) from the French border over what he suggested in so many words was excessive taxation.

In an open letter, Depardieu wrote:
I leave after paying, in 2012, 85% tax on my income. But I keep in mind that France was beautiful and I hope will remain. 
I give you my passport and Social Security, which I've never used. We no longer the same country, I'm a true European, a citizen of the world, as my father has always taught.
Depardieu bares his view on taxation:
(Original French)
Je n'ai malheureusement plus rien à faire ici, mais je continuerai à aimer les Français et ce public avec lequel j'ai partagé tant d'émotions!Je pars parce que vous considérez que le succès, la création, le talent, en fait, la différence, doivent être sanctionnés. 
(Google Translation)
I unfortunately have nothing more to do here, but I continue to love the French public and with whom I shared so many emotions! I'm leaving because you consider that success, creativity, talent...   must be punished.
French Prime Minister Jean-Marc Ayrault said Depardieu's act of leaving the country was "shabby", and suggested he was "shirking his patriotic responsibilities".

In an article on The Telegraph, Ayrault was quoted saying that those who left France were greedy.

"Those who are seeking exile abroad are not those who are scared of becoming poor," the prime minister declared after unveiling sweeping anti-poverty measures to help those hit by the economic crisis. 
These individuals are leaving "because they want to get even richer," he said. "We cannot fight poverty if those with the most, and sometimes with a lot, do not show solidarity and a bit of generosity," he added 
... ... 
Announcing plans to spend up to 2.5 billion euros by 2017 to help the poor, Mr Ayrault said that poverty affected 12.9 percent of the population in 2002 and rose to 14.1 percent in 2010.

As such, we assume that Depardieu's line of reasoning on taxation would cleave to certain well trodden lines usually quoted against taxing the rich -- a line of reasoning seemingly not borne out by empirical data.
It's axiomatic among Republicans that taxes on the rich are the single most important factor determining economic growth. If that were true, then the period from 1988 to 1990, when the top rate was just 28 percent, should have been the most prosperous in recent American history. During that time we had the lowest top rate since 1931. But although 1988 started out okay with a real GDP growth rate of 4.1 percent, it fell to 3.6 percent in 1989 and just 1.9 percent in 1990. 
Conversely, the period from 1993 to 2000, when the top rate rose from 31 percent to 39.6 percent, should have been a period of dismal growth. But in fact, that period was the most prosperous in recent American history. Real GDP growth averaged 3.9 percent per year – more than 50 percent above the average postwar growth rate. 
Then there should have been a burst of even faster growth when the top rate was reduced in the 2000s to 35 percent – a rate that is still in effect. But during that period, real GDP growth has averaged just 1.8 percent – 30 percent below the average postwar rate. 
So where is the data supporting the argument that taxes on the rich are the sine qua non of growth? I don’t see it. On the contrary, the data from the last several decades would in fact support the opposite conclusion – that higher tax rates on the wealthy stimulate growth.

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