**France Mulls New Tax for High Earners Over €250,000 Annually**
*By Dwaipayan Roy | October 4, 2025, 6:47 PM*
French Prime Minister Sebastien Lecornu is reportedly considering a new tax targeting individuals earning over €250,000 (approximately ₹2.6 crore) annually. This initiative aims to secure support from the Socialist opposition for the government’s 2026 state budget, according to financial daily *Les Echos*. The proposed tax measures are expected to generate an additional €3 billion in fiscal revenue next year.
**Proposed Tax Measures**
One key proposal involves the renewal of the CDHR (differential contribution on high incomes) “minimum tax,” originally introduced by Lecornu’s predecessor, Francois Bayrou. This tax ensures that high-income households pay at least 20% of their income in taxes.
Additionally, the government plans to target super-wealthy individuals using holding companies to avoid dividend taxes. This measure alone could bring in just over €1 billion in 2026.
**Combating Tax Evasion**
The French Finance Ministry has identified approximately 30,000 financial structures that could be affected by these new rules. These entities are reportedly used to collect dividends without distributing them, thereby circumventing dividend taxes.
Combined, these measures are expected to increase government revenue by between €4 billion and €4.5 billion.
**Political Strategy and Opposition**
Sebastien Lecornu, who recently became President Emmanuel Macron’s fifth prime minister in two years, is making these moves to win left-wing support for the upcoming budget.
However, the Socialists have criticized the current proposals as “insufficient.” They are demanding the introduction of a 2% wealth tax on France’s top 0.01% as a condition for their support. While this demand is unpopular among conservatives, it could bolster Lecornu’s political position ahead of the 2026 budget vote.
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The new tax proposals reflect growing efforts by the French government to increase fiscal contributions from the wealthiest segments of society amid ongoing political negotiations. More discussions are expected in the coming months as the budget process unfolds.
https://www.newsbytesapp.com/news/world/france-to-tax-high-earners-to-win-socialist-support/story
