NCPA - National Center for Policy Analysis

The French and Taxes

July 2, 2003

According to a report in Forbes Magazine, France has the heaviest tax burden among the 47 countries surveyed. It had a score of 179.4 on the Tax Misery Index, which is calculated by adding together corporate and individual income tax rates, and wealth, Social Security and sales taxes. With enactment of the recent tax cut, the United States has a ranking of just 85.3, reports Bruce Bartlett.

However, such a calculation overstates the French tax burden because evasion of the income tax is so pervasive.

  • France collects less revenue from personal income taxes than any other major country, according to the Organization for Economic Cooperation and Development.
  • It gets just 18 percent of its total revenue from this source versus 42.4 percent in the United States.
  • However, sales and Social Security taxes, which are harder to evade, are much higher in France.

It appears that the French channel their anger against high taxes into individual income tax evasion, rather than political action for tax cuts, says Bartlett. The government turns a blind eye because the taxes it really depends upon are still paid. This makes people feel they are getting away with something even as their total tax burden rises ever higher. It also diffuses pressure to reduce taxes.

According to Bartlett, it seems that France still successfully follows the maxim of Jean Baptiste Colbert, minister of finance to King Louis XIV in the 17th century. "The art of taxation," Colbert said, "consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing."

Source: Bruce Bartlett, "The French and Taxes," National Center for Policy Analysis, July 3. 2003.

 

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