French court approves new tax on companies for high salaries

France’s constitutional court has approved a tax on companies that pay salaries of more than 1 million euros (just under $1.4 million).

Under President Francois Hollande’s proposal, businesses will be required to pay 50 percent taxes on wages above the threshold for 2013 and 2014. The new tax, combined with already existing charges levied, amounts to about 75 percent of salaries above the cutoff mark.

The measure falls in line of Hollande’s campaign promises to push France’s wealthy to extend a bigger hand to help the country out of its economic slump. But the proposal has sparked the ire of companies and foreign investors who complain that France is becoming increasingly anti-business.

The well-off in France have become increasingly discontent by new taxes adopted by the country’s Socialist government headed by Hollande. Actor Gerard Depardieu, fed up with what he described as the government punishing creativity and success, gave up his French citizenship and this year became a citizen of Russia.

Last year, France’s constitutional court rejected a 75 percent tax on individual workers who earned more than 1 million euros. The constitutional court said that taxes for individuals was capped at 66 percent.

The approved new tax will be capped at 5 percent of a company’s revenue. It is estimated that it will raise about 210 million euros a year.

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