As the Yellow Vest demonstrations lose steam as the movement enters its seventh week, French President Emmanuel Macron is offering still more concessions to the demonstrators as he attempts to revive his moribund approval rating, which has sunk to just above 20%.
After his government promised tax cuts that will blow out the French budget deficit and urged French companies to pay year-end bonuses to their employees, effectively a call to bribe them into calming down, Macron said that he's planning to crack down on executives who have avoided paying taxes in France. Extra scrutiny will be applied to executives of companies of which the French government owns a stake.
The French government is scrutinizing the tax situation of business leaders and will take measures to force them to pay their taxes in France if necessary, Budget Minister Gerald Darmanin told the Journal du Dimanche newspaper.
"Heads of listed businesses or businesses in which the state has a stake must absolutely be French tax residents," Darmanin said in the interview.
According to Bloomberg, the decision is Macron's latest attempt to quell the Yellow Vests demonstrators' anger, more than one month after he abandoned his plans to hike gas taxes, a move he tried to spin as a concession to environmentalists (who were subsequently angered by his decision to back down).
But the people of France saw these proposed tax hikes as just another sign that Macron was placing a disproportionate share of the French state's tax burden on the common people, and allowing the wealthy to walk free (after taking office, he scrapped a wealth tax in a move that was seen as a betrayal by many of those who voted for him). Related: New Regulations Could Boost Lagging Solar Growth
After tax cuts take effect in the new year, Macron has also promised a dialogue about inequality and the high cost of living in France.
France's budget minister said efforts to make executives pay tax in France should encourage more "civic" behavior. However, ramping up taxes on the wealthy might be more difficult than the French government is making it believe (which is one reason Macron has resisted reimposing the wealth tax).
But making all executives pay tax in France will not be simple as it could require renegotiating tax conventions.
"It would take years and we aren’t necessarily in a position of force to impose our views," Olivier Grenon-Andrieu, head of wealth advisory firm Equance, told Le Journal du Dimanche.
Still, whether any of this will help boost Macron's popularity remains to be seen: So far, his approval rating has only continued to sag, offering an opening to the nationalists whom he defeated during his presidential victory.
By Zerohedge
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