Right-Wing Objections

Yet in a country that already has the highest taxation as a share of GDP in the Organisation for Economic Co-operation and Development (OECD), there is fierce right-wing opposition to the proposal. Critics say the measure would be “predatory” and unconstitutional, would spark a billionaire exodus and hurt investment. Others note that the plan would tax “virtual” wealth in the form of company stocks, which in some cases would need to be sold for the contributors to have enough liquidity to pay.

This month, French luxury goods magnate Bernard Arnault — Europe’s richest man with a net worth of $169 billion — lambasted the proposal as “offensive” and “deadly for our economy,” and denounced the plan’s architect as a far-left ideologue. As a result of the tax, Arnault would have to cough up around €1 billion per year. Meanwhile, France’s main employers’ organization announced a “huge rally” in coming days to protest the plan.

Economic inequalities have been rising throughout the developed world for decades. In recent years, internationally renowned French academics such as Thomas Piketty have played an important part in identifying this trend, highlighting how wealth concentration has picked up speed since the introduction of neoliberal policies across the West in the 1980s. In France, over the last thirty years the share of the country’s total wealth owned by the top 1 percent has jumped ten points to 27 percent, while that of the bottom half of the population has halved to barely 5 percent.

As Piketty showed in his groundbreaking Capital in the Twenty-First Century, in today’s world the return on capital tends to outstrip the rate of overall economic growth, meaning that the gap between the owners of large financial fortunes and those who earn a living through labor is bound to increase every year — unless corrections are put in place.

In this context, Zucman’s proposal would be a step toward adapting the French tax system to developments within capitalism, argues Sengayrac: “It hits at the very heart of the dynamic of reproduction and increase of inequalities.”

Since his election in 2017, French president Emmanuel Macron has hardly prioritized tackling the widening income and wealth gaps: One of his first moves was to reduce the scope of France’s wealth tax to cover only real estate, and to introduce a flat 30 percent tax on income from interest, dividends, and capital gains. The stated goal was to make France more attractive to investors, but the two measures were seen by many as big gifts to the wealthy, at a cost for state coffers of several billion euros every year.

Studies show that while Macron’s presidency has reduced the tax burden on most French people, it’s wealthier taxpayers who have benefited most, in turn feeding economic inequalities. Macron’s tax cuts have been blamed for much of the rise in France’s budget deficit and public debt on his watch.

The Left has long pushed for higher taxation for the wealthiest. In the 2010s, Socialist president François Hollande famously introduced a 75 percent tax on earnings above €1 million, before being forced to water it down and ultimately scrap it amid a deluge of criticism — including from Macron, who during his stint as an Hollande aide slammed it as “Cuba without the sun.”

A version of the Zucman tax itself was actually passed by the French Parliament’s lower house in January this year, with the votes of the Left but without the participation of the government’s center-right alliance — confident that the bill would then be stopped in the conservative-controlled Senate, as it indeed happened a few months later.

The proposal has also drawn international attention. Last year, the Brazilian government led by Luiz Inácio Lula da Silva, then host of the G20, invited Zucman to advise on how to coordinate international efforts to tax the superwealthy, which were put at the top of the group’s agenda.

Deadlock

Since Macron called snap elections in 2024, which produced no obvious majority force in parliament, France has been stuck in political deadlock. It remains unclear whether Lecornu — the fifth prime minister in just two years — will succeed at forming a government and what his exact program will look like. Lecornu, a longtime Macron ally who started his political career with the mainstream right, has so far shut the door to the Zucman tax. However, he will likely need the backing of the Parti Socialiste to survive, which will be difficult without some kind of compromise on the taxation of the superrich.

Meanwhile, the measure is receiving extensive media coverage and is hugely popular in the polls, with around 86 percent of the French backing it. According to political scientist Luc Rouban, this has largely to do with a widespread sense that the rules of the game aren’t the same for everyone, that a small minority is disproportionately benefitting from globalization, and the state needs to reestablish its fiscal sovereignty. Sentiments, he said, that echo the grievances expressed by the gilets jaunes or Yellow Jackets movement, whose protests raged across 2018 and 2019 after Macron tried to hike fuel taxes, in a move disproportionately painful for the less well-off.

“The battle for public opinion has already been won,” said Sengayrac, drawing a comparison with the introduction of France’s progressive income tax in 1914, following years of conservative resistance. “The creation of a new tax takes time. Public opinion needs to be convinced first, and only after that do the politicians come around.” For now, it seems that the French are sure they want the rich to pay more.