France Considers Tax Amnesty To Halt Capital Flight

by Ulrika Lomas, Tax-News.com, Brussels

04 December 2003

French Budget Minister Alain Lambert indicated on Tuesday that the government is considering introducing a tax amnesty for wealthy investors repatriating assets to France in a bid to halt the tide of capital flight from the country witnessed in recent years.

Speaking on a national radio station Lambert said that this politically sensitive issue could no longer be ignored, and remarked that he does not regard the subject as “taboo”.

According to a report written by French assembly member Gilles Carrez some 11 billion euros worth of assets left France in the previous five years in response to high inheritance and wealth taxes.

Mr Lambert said that a French amnesty would probably be introduced along similar lines to those that will be seen in Belgium and Germany next year, although in the latter case a 25% tax is to be imposed on repatriated funds.

The expedient of an amnesty was last tried in France in 1986, when repatriated funds were allowed back without a tax charge, and the wealth tax was suspended. The amount repatriated was never announced, but is thought to have been rather low.

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