French Luxury Giants Cry Foul Over “Made in France” Tax

French Business Leaders Cry Foul Over Proposed “Made in France” Tax

Luxury Giants Feel the Pinch

Jean-Jacques Guiony, the financial director of LVMH, expressed strong disapproval of the proposed exceptional contribution on large companies outlined in the 2025 draft budget, calling it a “tax on made in France” that is “simply not normal.”

Speaking at an economic summit organized by Challenges magazine, Guiony emphasized the disproportionate burden this new tax would place on export-oriented French businesses. He pointed out that out of a projected €7 billion in additional financial contributions from companies, four behemoths – LVMH, L’Oréal, Hermès, and Airbus – would account for a staggering 25%. “We are talking about 7 billion euros of additional financial contribution from companies,” Guiony stated. “LVMH alone is 700 million euros, so 10%, you add L’Oréal and Hermès, we arrive at 20% and you add Airbus, we arrive at 25%.”

Targeting Success: A Misguided Approach?

Guiony argued that this policy effectively punishes businesses that contribute significantly to the French economy through exports, job creation, and tax revenue. “You have 25% of the total from four companies which all have the characteristic of being exporting companies,” he explained. “So we can qualify this tax increase as a tax on made in France. This cannot be normal.”

He stressed the need to tax wealth rather than exports, asserting that France doesn’t have a surplus of export-driven companies. “We want to tax wealth, but here we tax exports,” Guiony lamented. “We don’t have that many exporting companies in France, we target those that pay a lot of taxes in France, that is to say those that produce in France, those that create jobs in France.”

Using a vivid metaphor, Guiony lamented, “It’s certain that the sheep next door is easier to shear than the one next door. The fact remains that the sheep next door is the one who invests in France, creates jobs and pays taxes.”

LVMH, the global luxury powerhouse led by Bernard Arnault, anticipates shelling out between €700 million and €800 million due to this exceptional contribution.

Other major players in the French luxury sector, Hermès and L’Oréal, also expressed concerns. Hermès projected an impact of €300 million, while L’Oréal estimated its share of the burden to be slightly over €250 million.

These projections come as the luxury sector, along with the broader French economy, anticipates a slowdown in growth in 2024. Despite this looming slowdown, LVMH achieved a remarkable turnover exceeding €86 billion in 2023.

What ​are the potential consequences of the “Made in France” tax on the French economy?

## “Made in France” Tax: A ⁢Luxury Burden?

**Anchor:** Joining⁢ us today is⁤ Jean-Jacques Guiony, the financial ‍director ⁣of LVMH, to discuss his concerns about the proposed “exceptional contribution” on large companies outlined in the 2025 draft⁤ budget.

Mr. Guiony, thank you for being ​here. You’ve called this proposed tax a “tax on made​ in France.” Can you elaborate on that?

**Guiony:** Absolutely. This tax disproportionately targets companies that are successful exporters, companies like LVMH,​ L’Oréal, Hermès, and ⁢Airbus. These are companies that contribute significantly to the French economy through job⁢ creation, international ‍trade, and brand prestige.

**Anchor:** You’re essentially saying these ‌companies are being punished for ⁣their success?

**Guiony:** Precisely. We’re‍ being​ asked to shoulder a disproportionate burden – 25% of the €7 billion​ in additional contributions ⁢will come from just four companies [[1](https://www.lvmh.com/en/our-group/economic-impact)]. This discourages investment, innovation,⁢ and ultimately,⁢ harms the very sectors the government claims ⁢to support. For‍ LVMH alone, this translates ‌to a staggering €700 million contribution.

**Anchor:** The government argues that ​this is a necessary measure to​ fund social programs and address growing inequality. ⁣ How do ⁤you respond ‍to that?

**Guiony:** While I understand ‍the need for social support, I believe there are more equitable ways to achieve ⁢these goals. Targeting specific ​industries based​ on their success is not the solution. It ⁤sends a negative signal to investors and could ultimately ‍harm France’s competitiveness on the global stage.

​**Anchor:** Thank you for sharing your​ perspective,‌ Mr. Guiony.

**Guiony:** Thank you⁤ for having me.