Sarkozy drops proposed French second home tax

Published 21st Jun 2011

Overseas investors owning a holiday home in France can breathe a sigh of relief, as the French president has dropped his unpopular plan to hit foreign property owners with a third tax on their homes.

British expatriates and holidaymakers in particular, of which around 180,000 own homes in France, were due to be affected by the scheme, which was to tax non-resident property owners 20 per cent of their property's rental income per year. With two sets of annual property taxes already in place, one by the owner and one by the occupier, many owners were in uproar over the plan, which some French senators had claimed was "electoral suicide" for President Sarkozy.

"The president told us he had been convinced [the law was a bad idea] and had taken his decision [to scrap it]", senator Joelle Garriaud-Maylam told the Daily Telegraph. "British people help rejuvenate some of our countryside and have a very positive influence, and we should be grateful", she continued.

The law would have also applied to French citizens living abroad who have homes in France, and with French expats able to elect MPs to parliament from next year onward, the political backlash may have seen Sarkozy's popularity suffering. There was also talk that it may have been against EU laws. "It is clear that EU laws would not permit a selective tax on just one group of residents in France", said British MP Dennis MacShane. "This is welcome news for hundreds of thousands of Brits who live and work or have or are thinking of buying homes in France."

Source: ' TMC '

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