Angry birds attack French tax on entrepreneurs

By Sarah Dilorenzo

Associated Press

Published: Friday, Oct. 5 2012 12:00 a.m. MDT

It remains unclear who these pigeons are. Someone responding to a message sent to their Facebook account by The Associated Press said the group represents 40,000 entrepreneurs but refused to grant an interview or identify their members.

But other entrepreneurs have come forward publicly in recent days to talk about how difficult it is to start a business here.

"This budget, in its essence, at its heart, negates the development of business. That incontestable," said Jean-Claude Volot, head of Dedienne Aerospace and a former state-appointed mediator for companies. "The whole environment is negative."

On Thursday morning, the movement, not even a week old, clocked its first success. Finance Minister Pierre Moscovici and Budget Minister Jerome Cahuzac promised concessions after meeting with a group of young entrepreneurs.

Moscovici even seemed to be stealing from the pigeons' songbook when he told reporters after the meeting that money made from selling a company you started shouldn't be considered passive profit. "That's remuneration for work," he said. "Risk can be rewarded."

The government now says that that people who are selling their own businesses, as opposed to investors selling shares in a company, would pay the former flat tax rate of 19 percent.

Moscovici said other concessions are being considered, like improving the exemption for people who reinvest their gains.

But the fight isn't over. The group posted a statement on the Facebook page Friday saying that they welcomed the government concession but that they will remain vigilant and "not be satisfied with a handful of dried bread."

France's capital tax regime

And other entrepreneurs said that the law was just another drop in the bucket of anti-business sentiment they feel in France.

Tony Ca'Zorzi, who has founded a company that is creating city guides for mobile devices, said high taxes are only half the battle in France.

"There's a lot of red tape, a lot of small rules here and there," he said, estimating that 25 percent of his time is spent on dealing with regulations. "It's a mess."

Agnes Clement-Yamakado, who started a furniture company with her husband in 1986, said that of her eight employees, one is dedicated to handling all the onerous administrative tasks. "It costs a fortune," she said — and that's just to figure out how much you owe.

Sarah DiLorenzo can be reached on Twitter at www.twitter.com/sdilorenzo

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