The last few weeks have been quite eventful in France with Mr. Hollande’s decision to impose a 75 per cent tax rate on incomes over EUR 1m. The French president left major fortune holders seeking a desperate solution to prevent such high taxation on their wealth.
UHNWIs such as Mr. Bernard Arnault (CEO of LVMH, France’s richest man and the world’s fourth richest person with a personal wealth estimated at EUR 32 billion) are applying for dual citizenships. Mr. Arnault desperately tried to gain Franco-Belgian citizenship but his move raised some criticism and general patriotic outrage in France.
Other high earners will simply prefer flying away to tax havens. Celebrities, major head of industries as well as medium to large-size firms executives are expecting to exile to such places in the coming weeks. The famous French singer Francoise Hardy who recorded with Blur in the 1990s has confirmed she will move either to London or New-York while Christophe Jallet, a footballer with Paris St Germain (PSG) warned that many high-earning footballers would be likely to leave in the near future.
London (along New-York, Delaware, Luxembourg, Hong Kong and Geneva) is a top destination for tax émigrés, especially since Mr. Cameron stated few months ago that he would “roll out the red carpet” to French firms if Mr. Hollande was to implement his wealth tax.
Hoping across the Channel isn’t guaranteeing a brighter future to the exiles, the taxman strikes in the UK too! Tackling tax evasion is a top priority for the HM Revenue & Customs which has set up a special unit in 2009 targeting multi-millionaire undeclared offshore income and tax evasion. The High Net Worth Unit (HNWU) has been looking into the personal tax affairs of about 5,000 of the UK’s wealthiest taxpayers and has already brought in an impressive amount of £80m since April 2012!