Thursday, October 4, 2012

Private Equity Threatens to Leave France

Private equity firms are threatening to leave France because of Hollande's 75% marginal tax on high incomes, which will apparently apply to "carried interest," the private-equity term for gains by fund managers. Some 280 such firms are housed in Paris, and France is the second-largest European market for leveraged buyouts, after Britain, according to the Bloomberg report.

Entrepreneurs in (mostly high-tech) startups have also protested other proposed changes in the French tax code. The government's announcement of reduced charges on firms' payrolls may have been rushed to counter these attacks from self-styled pigeons. See Bernard Girard's comment here. And see also FT Alphaville here.