“Should I be preparing to leave the country?” the executive asked Mr. Grandil.Or, to get right down to the nitty gritty, we can look at actual numbers:
The lawyer’s counsel: Wait and see. For now, at least.
A tax accountant in Paris with many wealthy clients, Steve Horton, has calculated that a two-parent, two-child household with taxable annual income of a bit more than 2.22 million euros ($2.75 million) now has after-tax take-home pay of about 1.1 million euros ($1.35 million) under France’s current tax system."Confiscation" looks a little less bleak now. A family of four should be able to get by on $966,000 after taxes, even in Paris. Perhaps the rich won't be forced to avail themselves of the privilege they share with the poor, to sleep under bridges, after all. And if Johnny Hallyday and Laetitia Casta decide to make their homes elsewhere, France will still have Sylvie Vartan and Sophie Marceau to console itself.
That household would end up with 780,000 euros, or $966,000, if the Hollande tax took effect, Mr. Horton says. (The same family, with comparable income in Manhattan, would take home $1.55 million, the dollar equivalent of 1.25 million euros, after paying federal, state and city income taxes, he calculated.)
But what about the disincentivizing effect of high marginal tax rates, you ask? It's not clear that there are any, but economists convinced that entrepreneurs will go on strike if limited to a million a year will now have a natural experiment with which to prove their contention, if only they can somehow control for all the potential confounding variables, which are legion. To me, it's always seemed that one of the great attractions of building a company is the power that goes with controlling it. The income is nice, to be sure, but power, they say, is the greater aphrodisiac.