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By Gregory Viscusi - Thu Mar 15 11:14:56 GMT 2012

Nicolas Sarkozy, president of France.

Nicolas Sarkozy, president of France. Photographer: Jock Fistick/Bloomberg

Frances presidential campaign has turned into a race to tax the most.

On Feb. 27, Socialist frontrunner Francois Hollande said he plans a 75 percent levy on income over 1 million euros ($1.31 million) on top of his pledge to raise the wealth tax and eliminate exemptions for overtime work. President Nicolas Sarkozy followed with a proposed tax on the worldwide revenue of large French companies and this week a levy on fiscal exiles. Both candidates want to impose a fee on financial transactions.

Unlike in the U.S., where higher levies are a vote-killer, in France, such increases win support in the polls, more so after the European debt crisis cooled economic growth, raised jobless claims to a 12-year high and the unemployment rate to about 10 percent. An Ifop poll this month showed that 61 percent of the French are in favor of Hollandes millionaire tax.

A U.S. election campaign is all about who promises to cut taxes while here its about who will tax more, Maurice Levy, chief executive officer of advertising company Publicis SA, said March 13 at a business conference in Paris.

Frances tax revenue as a proportion of gross domestic product is one the highest in the world at 43 percent in 2010, according to the Organization for Economic Cooperation and Development. That compares with 36.3 percent in Germany, 25 percent in the U.S. and the OECD average of 34 percent.

The eagerness of French candidates to promise new taxes, and the positive response from voters stem at least in part from the sentiment that tax cuts at the start of Sarkozys five-year term allowed the wealthy to pay less than their fair share during the economic crisis.

Both candidates are trying to capitalize on the issue: Sarkozy by trying to dispel the perception that hes the president of the rich, and Hollande by trying to show that he can be the president of redistribution. Antonio Barroso, an analyst at Eurasia Group, said in an interview.

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New Day New Tax as Sarkozy Battles Hollande in French Campaign

EDITORIAL

Must shoulder some of the blame ... Wayne Swan. Photo: Alex Ellinghausen

NONE of the main parties has come off looking good in the standoff over the proposed cut to the company tax rate linked to the minerals resource rent tax.

The new tax, which in its latest guise will fund a reduction in the company tax rate from 30 per cent to 29 per cent, has plagued Labor since it was recommended by the Henry tax review two years ago. Henry suggested the special tax on miners could fund a 5 percentage point reduction in the company tax rate, in large part to address the challenges faced by companies on wrong side of the mining boom.

That the cut has shrunk to just 1 percentage point is a reflection of Labor's mishandling of the reform. Even before the Labor government wilted under pressure from the mining industry, it was not proposing to deliver Henry's full recommended cut.

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The muddle is remembered for contributing to the downfall of Kevin Rudd as prime minister but blame also lies with the Treasurer, Wayne Swan. Had he done a better job of consulting the industry, and promoting the original tax to the electorate, businesses may today be looking forward to a much bigger tax break. This ineptitude cost Labor, and the country, a much more significant reform.

But the Coalition is also on shaky ground. Its opposition to the mining tax means it stands in the way of a tax reduction to business - one of its core constituencies - at a time when sentiment is fragile and many companies in key economic sectors are under great stress. Businesses outside mining could be forgiven for questioning why the party believes that staying on side with the miners is more important than tax relief for the vast majority of firms.

Now the Greens have intervened to put the entire measure in jeopardy just days before the tax was expected to become law. They want the

1 percentage point company tax cut restricted to businesses with a turnover of less than $2 million. The Greens leader, Bob Brown, says it ''doesn't make sense'' to give big business a tax cut but does not explain why. There is a strong argument that this tax cut should be available to companies of all sizes. The Greens proposal also undermines one of the fundamental aims of business tax reform - to make the entire corporate tax system more internationally competitive. Business is being let down by all sides of politics in this row.

Excerpt from:
Tax reform by a thousand cuts

A shortage of English-language school places in Hong Kong is hurting expatriate families and damaging the city's reputation as a regional business hub, parents and lobby groups say.

The situation is driving some companies to look at alternatives such as Singapore, Bangkok and Shanghai, they say.

International chambers of commerce have united to pressure the semi-autonomous Chinese's territory to wake up to the problem, but say their pleas for action have fallen on deaf ears.

"There is no space and no flexibility for families like ours. It's a big sacrifice on my family's part ... to come to Hong Kong," said a recently arrived American businessman and father-of-two, requesting anonymity.

"All we as parents are concerned with coming to Hong Kong is will any school accept our children? A lot of firms have decided to go to other cities in Asia where school accessibility is easier. Hong Kong is losing out."

Hong Kong had the dubious distinction of making assignment services firm Brookfield Global Relocation's Top 20 list of most challenging destinations for the first time last year, with schooling cited as the major problem.

"This continues to be the number one burning issue that (foreign companies) are facing in growing their businesses out here," in Hong Kong, said Janet de Silva, the American Chamber of Commerce's (AmCham) education affairs group chairwoman.

Immigration department figures show the number of US and UK passport holders issued with Hong Kong employment visas increased 42.48 percent from 2009 to 2011, as more people are drawn to the city as a gateway to the Chinese market.

But the former British colony's English-language schools have struggled to keep up with the demand due to land shortages, red tape and funding problems.

School waiting lists typically contain up to 100 names, and only two state-funded English-language schools had any spare spaces at the start of this year, according to school data and relocation specialists.

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Hong Kong's school place shortage deters expats

THERE have been far fewer consumer complaints from expats in Shanghai, which authorities attribute to the language barrier and poor publicity of the hotline service.

Compared to the huge number of complaints received from Chinese consumers - more than 111,000 - the city's consumer rights hotline 12315 only received 18 complaints from expats last year. China marks Consumer Rights Day today.

The city had more than 200,000 overseas residents at the end of 2010, according to the country's latest population census.

This does not mean that expats don't encounter consumer disputes. According to the Shanghai Industrial and Commercial Administrative Bureau, expats' complaints cover a wide range of problems, including public transport services, flights, food safety and apartment rent. But for various reasons, they won't call the hotline but try to solve the problem via other means, like legal action, or stay silent.

An American man who preferred to stay anonymous said he once called the hotline to complain about an airline company over ticket refund, but the operator hung up as soon as he spoke English. "I had to give up and asked my Chinese friends for help," the American said, adding that he believed the operator couldn't speak English.

Another expat, Obed, a Kenyan studying at Shanghai University, claimed he was not even aware of any hotline for consumers. "So if I had some consumer rights problems, I would just let it go," he said.

The Shanghai Commission for Consumers' Rights and Interests Protection admitted the hotline is not known among expats but officials still have no plans to promote the service. "We accept English complaints, but we don't have a special platform for them," said Zhao Jiaoli, an official with the commission.

Zhao said several operators at the hotline speak English, but only one is an English major.

Meanwhile, the Shanghai Bureau of Quality and Technical Supervision said its hotline 12365, which accepts complaints about product quality and food safety, has seldom received complaints from foreigners despite opening an English service several years ago. The officials said this was "quite normal" because the bureau has never promoted the hotline's English service.

In fact, some Chinese consumers have complained that the hotline was difficult to access.

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Eastday-Expats shrug off consumer gripes

-- Over 250 senior financiers gathered to hear from Professor Chan, Ashley Alder, the Chief Executive Officer of the Securities and Futures Commission of Hong Kong and Peter Pang, Deputy Chief Executive of the Hong Kong Monetary Authority

-- Senior representatives from Allianz Global Investors, BlackRock Asset Management, HSBC Hong Kong, PingAn of China Asset Management and Harvest Global Investments as well as the financial regulators of Hong Kong also spoke about the benefits of doing business in Hong Kong

NEW YORK, March 15,2012 /PRNewswire/ -- Speaking to an audience of over 250 senior financial services executives at the opening of the New York conference, Professor Chan said, "As the world searches for growth, Hong Kong continues to offer unrivalled advantages and opportunities to businesses wanting to seize the Eastern advantage. Hong Kong with its prime location and international connectivity has long been serving as a gateway for businesses into and out of Mainland China.

"As China's premier city for global finance and a tried and trusted testing ground for new ideas throughout China's economic reform, Hong Kong is the natural choice for piloting the liberalisation of the RMB. The three key areas of offshore RMB business that Hong Kong is developing are banking, capital-raising and trade settlement. Our RMB offshore platform is not just for the benefit and convenience of Hong Kong and China. It is designed to benefit everyone who wishes to embrace China's latest development miracle."

Professor K.C. Chan, Secretary for Financial Services and the Treasury of the HKSAR Government, was the keynote speaker at today's conference in New York. His speech was followed by two panel discussions among senior business representatives:

Peter Pang, Deputy Chief Executive of the Hong Kong Monetary Authority, who led the panel discussion on the deepening of Hong Kong's renminbi market, said: "Since the launch of RMB banking in Hong Kong in 2004, RMB deposits in Hong Kong have grown to around RMB 576 billion as at the end of January 2012. That is about 1.6 times the amount a year earlier and is testament to the attractiveness of Hong Kong's unique advantages to businesses the world over."

Excerpt from:
Professor K.C. Chan, Secretary for Financial Services and the Treasury, Invites New York's Financiers to Sample the ...