[stygianguest]

Of course that only applies to the salary over one million. As people earning that much usually have plenty of options to get their money through different channels, this is purely political posturing. They didn't even significantly increase tax revenue.

I agree that it is ridiculous but, in a similar way, it is ridiculous to claim that one rate makes France unfriendly for business.

[lke]

Are marginal tax rates rare ? It alway seems like people don't understand how they work. But i don't see how you could do without them, there would be a strong incentive not to change bracket.

[LekkoscPiwa]

> Of course that only applies to the salary over one million.

Of course! So have a look at me: worked 8 years in IT and saved about 150,000 USD in that time period. I paid taxes on this, mind you. To save this amount I had to live on much lower standard of living that my peers. My wife and my kid too. I quit the job, I'm trying to run a startup. I have a child, a wife and expenses related to that. Instead of getting regular income as everybody else, I spend my savings (accumulated capital) to try create something of value for the public. I take risks. My family does too. We live on 40000 dollars a year or less. Because I'm putting everything into this business. 2 years and 80000 so far plus income I lost by not working in 8-5 job in these 2 years.

Let's say it works out. I sell the business after 3 years for 1,000,000 dollars. You are telling me that it is fine to take 750,000 from me and from my family? For all the risks I took? For all the hard work? For years of living below standard my family could have afforded but decided to take risk and save, and invest? So, you would like to see me with just 1/4 of this? And give 3/4 to people who didn't take any risks, didn't save, are living comfortably (better than me!)

I don't think you understand. France is history.

[lke]

What don't you understand in "over one million" ?

If you sell it for 1,000,001 the 75% rate only applies to the extra 1. Not the whole 1,000,001 just the 1 that is over the million.

That's what is called a marginal taxe rate. Each tax braket only applies to the money within the backet range.

If you make 1,000,001 the first 6,000 are not taxed and the last one is taxed at 75%. (Or will be if we ever get that).

--

Edit : There also seems to be a concensus about selling not being taxed like a salary. I wouldn't know. But there was also quite a debate on whether the taxes on selling companies was to high.

[LekkoscPiwa]

True. But the first million is not tax free neither. If over 1,000,000 is 75% then I'd assume that below 1,000,000 isn't much better. I'd assume if I sell for 2,000,000 the total tax will be at least 50%. How is this fair?

[wazoox]

It's fair because you're driving on roads, bring your children to school, may need to go to hospital at times, and profit from a judicial system able to enforce law and your company's contracts, among other things. If you want to live in a country without taxes, try Somalia, or Congo.

[rfrey]

The debate is not between "taxes" and "no taxes." We're all clever enough to understand shades of gray.

[eli_gottlieb]

No, in my experience there are no shades of gray. It's just "taxation is theft". There is no level of taxes, no matter how low in real terms, where people actually stop complaining.

[crusso]

Everyone drives on roads, takes their kids to school, and may need to go to the hospital at times. Some of us pay extra for private roads to be built and for private schools for our children to attend because the government equivalents are crap.

As the poster mentioned, if you are an entrepreneur, normally you forgo a steady salary and corporate benefits in order for a big payout later. When the government is going to take a huge chunk out of that payout when you've already been sacrificing hard just to get there - it begins to look less and less worth it.

I've spent my adult career going from startup to startup. Looking at the current regulatory and confiscatory tax environment, I don't know if I'd do the same starting over.

If I could go back 20 years, I'd probably just go work for a big company like IBM or UPS and stay there. If I'm noticing that pressure against entrepreneurs then others are noticing it too. The government is slowly but surely killing off drivers that increase risk taking.

That's a bad thing.

[wazoox]

> As the poster mentioned, if you are an entrepreneur, normally you forgo a steady salary and corporate benefits in order for a big payout later.

Utter bullshit. I'm an entrepreneur, and you know why I was able to create a company? Because of the very good French unemployment benefits that allowed me to build up my business for nearly two years after my previous startup failed! Without that, lacking a personal fortune I just wouldn't have been able to create the company.

[dagw]

The 75% proposed tax is for earned salary not sales of shares. Thus it will only be relevant to you if you get your company to a point where you are taking out over 1 million euros a year in salary, not if you simply sell your company for over 1 million.

[lke]

See for yourself : http://fr.wikipedia.org/wiki/Baremes_de_l_impot_sur_le_reven...

Now you may not understand french but the table is quite understandable. Fist column the brackets, last column the marginal taxe rate.

[wazoox]

> I sell the business after 3 years for 1,000,000 dollars. You are telling me that it is fine to take 750,000 from me and from my family?

You're so very wrong.

1° the 75 % tax doesn't apply if you reinvest the money in a new company. There are several different ways to avoid paying the tax through investment. It's a tax on revenue, earnings, NOT capital. If you use your money as capital, basically you'll never pay more than about 35% taxes overall.

2° you don't understand how marginal tax rates work. You pay 75% of tax on everything ABOVE 1 million. So if you sell your company for 2 millions, the 75% applies on the second million but not the first one.

[eru]

> I sell the business after 3 years for 1,000,000 dollars. [...]

I don't know about French taxation, but I don't think the sale of the business would be taxed as a million dollars of income.

[unexpected]

If you sold the business, this would not be a salary - this would be a capital gains transaction.

[rguillebert]

The 75% tax only applies to salaries not if you sell your business and it's a marginal tax rate, if you earn 1,000,000 euros it doesn't apply to you.