Taxes, retirement and billionaires: together, the three ingredients are enough to spark controversy. The debate on the taxation of the ultra-rich has resurfaced following a report by the NGO Oxfam published on January 16. The association for the fight against poverty proposes to impose, up to 2%, the heritage of the 42 French billionaires. With an annual revenue of around 11 billion euros by 2027, according to its projections, this new tax base would make it possible to fill – almost – the anticipated deficit of the pension system expected by this deadline.
In a social context under tension, the measure has something to seduce some, horrify others. On the side of the opposition to the reform, one advances the “social justice”. In the ranks of the government, one castigates an “incoherent reasoning” and inappropriate. What is it really ?
At Oxfam, asking the French to work longer is seen as “deeply unfair”. “It is to make those who have taken the Covid crisis and that of the high cost of living in the face rather than those who have enriched themselves thanks to public intervention pay”, challenges Quentin Parrinello, the author of the report which seeks to thwart the current reform, “a purely political choice”. “It’s not inevitable,” he continues. There are other solutions to avoid the imbalance. Taxing the wealth of billionaires is one. »
Flows versus stocks
But on the political and economic scene, the measure provokes its share of criticism. Starting with a methodological reproach: “When we talk about financing pensions, we are talking about flows, regular and time-bound expenses. The heritage is not of the same nature, explains Philippe Crevel, director of the Circle of savings. It is a stock, which, by definition, is fluctuating. »
The heritage pointed out by Oxfam is financial: it targets the shares of companies owned by these ultra-rich. Their value depends on stock market prices, with sometimes very good years, especially in 2019 and 2021, sometimes declines, as in 2020 and 2022.
“By nature, these are not stable resources”, adds Henri Sterdyniak, an economist who is not very suspicious of being an ardent defender of capitalism, who also mentions the risk of distorting our pay-as-you-go system: “Pensions are financed by social contributions paid by assets. This gives them rights to these benefits. Funding them from another source is therefore inconsistent. »
The wealth of billionaires has increased by 11% per year for 22 years
Arguments to which Quentin Parrinello responds: “Certainly, the value of shares fluctuates. But in all our scenarios, a 2% tax is tenable over twenty-five years, and the billionaires remain winners, ”he assures. The NGO’s report points out that the fortunes of billionaires have increased by an average of 11% per year over the past twenty-two years.
As for social security contributions, the rapporteur agrees: they are indeed at the very origin of pensions. “It is precisely because of their constant reduction – through various exemptions to reduce the cost of labor – that pensions are today financed to a third by taxes, he regrets. We could also consider increasing them, and/or raising salaries. »
“Bernard Arnault does not have 196 billion euros in a current account, emphasizes Philippe Crevel. It is an appreciation, a virtual added value. So taxing this wealth could encourage billionaires to sell some of their shares to pay the tax, with the risk of seeing foreign investors interfere.
A risk of tax exile
An unfounded fear, according to Quentin Parrinello: “Billionaires already monetize all the time, argues the rapporteur, that is to say that they regularly sell small parts of their portfolio in exchange for cash. And that’s no scandal. »
Finally, many economists fear that such a measure would encourage tax exile. “We are in an open, globalized economy. With a tax system that is too restrictive, these people could be tempted to leave,” insists Philippe Crevel. “Only 0.2% of the taxpayers of the solidarity tax on wealth (ISF) had left the country”, answers Quentin Parrinello, who however recognizes a risk, “Emmanuel Macron having removed all the tools to fight against exile tax, such as the exit tax.
He insists on the fact that the taxation of the richest has recently resurfaced in many countries. “Including Spain, which has increased its tax on the wealth of the richest,” he says. As far as I know, however, we have not seen a wave of Spanish billionaires, economic refugees, land at our borders…” Undoubtedly, the arguments on both sides will liven up the debates on the pension reform.
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