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France says 75% tax will apply to footballers

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(Globalpost/GlobalPost)

France said Tuesday that a new 75 percent tax rate on upper incomes would apply to top football players despite claims from clubs that they would be exempt.

"The new system will apply to all businesses that pay salaries of more than one million euros ($1.3 million)," Prime Minister Jean-Marc Ayrault's office said, after media quoted club owners as saying they would escape the tax.

France's Socialist government has announced plans to shift the upper income tax charge to companies after its initial plan to charge individuals was struck down as unconstitutional.

The tax was a key promise of President Francois Hollande's election campaign last year but has come under fire from major companies and sports clubs who say it will drive top earners out of France.

The head of the French Football Federation, Noel Le Graet, told Le Parisien newspaper Tuesday that the tax would not apply to football clubs.

"The prime minister, to whom I have already asked the question, was clear: only large companies will be taxed. And professional clubs are considered as small- and medium-sized businesses, so they will not be affected by the 75 percent tax," he said.

But Ayrault's office said he had met with Le Graet in December, before the initial plan was struck down, but had not discussed the issue with him since.

The proposed tax rate, which the government says is a temporary measure aimed at tackling France's budget deficit, prompted widespread condemnation in business circles.

It led some notable figures, including actor Gerard Depardieu, to flee abroad into tax exile.

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http://www.globalpost.com/dispatch/news/afp/130402/france-says-75-tax-will-apply-footballers