U-turn on French second home tax

THE FRENCH government has abandoned plans to levy a controversial new tax on holiday homes owned by non-residents.

The proposed tax, announced last month, would have targeted non-residents, of all nationalities, who have second homes in France that are not rented out.

Up to 360,000 homes would have been affected from January 2012 and it was estimated that the tax would bring in €176m a year.

President Sarkozy and budget minister François Baroin met a group of UMP senators who represent French expatriates on Saturday afternoon to discuss the plan.

Transport minister Thierry Mariani, who was also present at the meeting, told reporters afterwards that the government had agreed not to pursue the proposed tax.

It has already been voted by the National Assembly and was due to be picked up by the Senate on Tuesday. It is part of a bigger finance bill that also deals with matters including the reform of wealth tax.

The proposed tax would have been at least as high as the taxe foncière in many cases, meaning an extra bill of several hundred to several thousand euros a year dependent on home size and location.

Emails and letters poured into The Connexion from readers who were angered by the plans.

There were concerns that the proposal would be passed because of a lack of political representation for expatriates.

The government believed that second home-owners should contribute more to the national budget, to make up for infrastructure and services they use but do not fund through income tax.

However the new tax, if it had been passed, would have been scrutinised by the European Union because it risks preventing the free movement of capital.

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