Reform of wealth tax: gold is really an investment for the rich?

A bullion and gold nuggets ethical in a workshop Chopard Meyrin, near Geneva, November 11, 2015 — FABRICE COFFRINI AFP

  • To silence critics on the reform of the ISF, the parliamentary LREM will strengthen the taxation of ” ostentatious wealth “.
  • The sale of bullion and gold coins will no longer be taxed.
  • The government assumes a symbolic measure, the professionals of the sector concerned.

The coins and ingots of gold have they done to turn the head of the deputies ? The finance commission of the national Assembly was the scene of lively debate this Thursday, in considering the removal of the wealth tax and its replacement by a tax on real estate. The measure has been adopted, with some alterations : in addition to a strengthening of the tax system on the
yachts and luxury cars, the tax on the sale of precious metals (TMP), for which gold is a part, will spend 10.5 % to 11.5 %.

This will strengthen the taxation of “signs of ostentatious wealth” aims to show that the government does not “gifts” to the wealthy. “It is necessary to correct this message that could be perceived badly” recognized at the beginning of October the government spokesman, Christophe Castaner.

“We can not consider gold as a sign of ostentatious wealth”

But the increase of the tax on the sale of gold, said “investment” – coins and ingots – does it only affect the most wealthy ? The professionals in the sector argue the contrary. “You can’t consider gold as a sign of ostentatious wealth” lance Francis de Lassus, director of external communication of CPoR Currencies, a company specialized in the gold market… and thus, is strongly affected by the tax. “In a study conducted in 2014 with Ipsos, we realized that 11 % of workers and 12% of employees possessed of gold, ” continues the specialist.

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According to the study, this gold is very often from the family, and is passed from generation to generation. “On the one hand, the rich will no longer have to declare their gold bullion to the ISF, and the other, families with average incomes will be more taxed when they want to resell their gold coins” regrets François de Lassus.

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What are the expected revenues ?

Philippe Herlin, author of gold, an investment for the future (2017), ” it is a mistake to increase this tax.” According to this economist, who defines himself as ” liberal-conservative “, he should do the opposite and lower the tax in order to “encourage people to put the gold into the economic circuit. The State there would be a winner, it would bring a lot more freeing up of the market “.

In fact, the government hopes that the taxes on these “ostentatious wealth” (yacht, luxury cars, gold) will pay 50 million euros per year. A figure to be compared with the shortfall for the State following the reform of the ISF : € 3.2 billion. Christophe Castaner had himself acknowledged at the beginning of October : “The recipe is quite low on these subjects, but it is in a symbol “.

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