French Left Calls for Tax on the Wealthy, Arnault Strongly Opposes

French business leaders have labeled the left’s proposal for a new tax on the super-rich as ‘mad’ and ‘communist’, while the Socialist Party pressures new Prime Minister Emmanuel Macron to ensure that the wealthy pay their ‘fair share’ in efforts to reduce the public deficit. Socialist votes are crucial for the survival of Prime Minister Sébastien Lecornu, after a hung parliament has ousted two prime ministers in less than a year due to their attempts to limit public spending. Leftist lawmakers are calling for individuals with wealth exceeding €100 million to pay a minimum of 2 percent tax annually on all their assets, including businesses, stocks, and unrealized gains, reports the Financial Times.

Bernard Arnault, CEO of luxury conglomerate LVMH, stated that this proposal represents ‘a clearly expressed desire to destroy the French economy’.

– I cannot believe that the French political forces that govern or have governed the country could give any credibility to this attack, which is devastating for our economy – said the billionaire in a statement.

Arnault is not the only one opposing this idea. Éric Larchevêque, co-founder of the cryptocurrency wallet company Ledger, told the Financial Times that it is ‘collectivism, it is communism… it is a fundamental attack on freedom and property rights’.

Given that Ledger was last valued at €1.3 billion by venture capital funds, Larchevêque’s stake places his wealth in a category that would be taxed under the new tax, even though the start-up does not generate profits or pay dividends. If implemented, the so-called Zucman tax — named after economist Gabriel Zucman who proposed the idea — would represent a blow to Macron’s pro-business agenda. Since his first election in 2017, he has promised to turn France into a ‘start-up nation’. One of his first moves was to ease the wealth tax on personal assets above a certain threshold, replacing it with a narrower property tax. He has also gradually reduced the corporate tax rate from 33 to 25 percent and introduced a flat tax of 30 percent on capital gains.

However, he has paid a high political price for these tax cuts, and opponents quickly labeled him ‘the president of the rich’. Macron remains opposed to the wealth tax, a source familiar with his thinking said. Lecornu told regional French newspapers that he is open to discussions on ‘tax fairness and burden sharing’, but warned that ‘assets must be treated with care’.

Proponents of the Zucman tax argue that it could raise €15 billion annually, reducing the need for spending cuts while lowering the public deficit, which is expected to reach 5.4 percent of GDP by the end of the year — one of the highest in the Eurozone.

However, other economists believe it would only bring in about €5 billion. Lecornu’s predecessor François Bayrou was ousted over a budget proposal for 2026 that included €44 billion in cuts and tax increases.

Arnault called Zucman a ‘radical leftist activist whose ideology aims to destroy the liberal economy’. Arnault is one of the richest people in the world, largely due to his controlling stake in the luxury group valued at €256 billion, listed on the Paris stock exchange.

Zucman’s ‘pseudo-academic competence has been widely disputed’, Arnault said, adding that the proposal is personally directed against him. Zucman described Arnault’s criticism as unfounded.

– It comes from one of the richest people in the world and in a context where academic freedom is increasingly questioned in many countries, this rhetoric… should concern us all – Zucman wrote on X, adding ‘It is time to tax billionaires at a minimum rate’.

Zucman’s tax would be particularly problematic for owners of promising tech start-ups that, despite high valuations on paper, often do not generate profits or pay dividends. These individuals could face tax bills larger than their available liquid assets. Zucman supporters argue that start-up founders could settle the tax by transferring shares of their companies to a French state fund or by borrowing — both ideas are highly controversial.

Critics, however, argue that the tax could be unconstitutional as it would affect a small number of about 1,800 people.

Philippe Corrot, co-founder of the tech start-up Mirakl, valued at $3.5 billion, told the FT that the proposal is absurd and dangerous as it would ‘put people in a position where they have to sell parts of their companies to pay taxes’.

However, the argument that more must be done to tax the super-rich is very popular in a country that is home to some of the wealthiest people in the world, such as Arnault or the billionaire families behind Hermès and L’Oréal.

More than half a million people marched through the streets of Paris and other French cities last week protesting against upcoming spending cuts, many carrying banners calling for taxing the rich. An Ifop survey commissioned by the socialists recently showed that 86 percent of respondents support the Zucman tax.

Many business leaders now believe that some form of wealth tax has become inevitable, but they hope for a softened version. One option could be an extension of the supposedly temporary measures included in this year’s budget, such as an additional tax for those earning more than €250,000 annually, as well as an increase in taxes for large companies.