The French government will outline incentives on Wednesday to make Paris a more attractive financial centre, officials said, as the French capital seeks to win finance jobs from London for a post-Brexit era.
France’s financial sector has often complained of government ambivalence towards the industry, which is subject to high taxes and sometimes hostile remarks from politicians.
Prime Minister Manuel Valls has made a snap decision to appear at the annual conference of the French financial industry’s lobby, Paris Europlace, later on Wednesday — a rare visit to the event by a high-ranking member of the government.
“We will do more in the future to enhance the attractiveness of the Paris financial centre: the government will do its part,” Bank of France governor Francois Villeroy de Galhau said in a speech to the conference.
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Seeing an opportunity in Britain’s June 23 referendum vote to quit the EU, the lobby has called for more favourable terms for expats in France. It also wants a cut in the tax on financial workers which is levied in France to compensate for the absence of value-added tax on the sector.
Though often neglected in the past, their proposals are no longer falling on deaf ears. President Francois Hollande said last week tax regulations needed to be adapted to make Paris more attractive and Finance Minister Michel Sapin hinted that taxation of expats could be made even more favourable.
During his election campaign in 2012, Hollande called the banking industry his enemy.
Expats coming to France and French nationals who return home after five years or more abroad already benefit from a range of tax breaks for five years after their arrival.
The scheme includes deductions for non-salary perks like employers paying for employees’ children’s school fees and on revenue earned on capital held abroad.
Villeroy also promised French regulators would quickly examine applications from any financial institutions licensed in Britain that might seek to set up shop in France.
Paris is already the biggest centre for many markets in the euro zone, including corporate bond issuance and investment management, with 3.6 trillion euros of assets under management.
But other financial centres in the 19-country currency bloc got an early start on Paris in lobbying London financial firms ahead of the vote on Britain’s EU membership vote last month.
The French government has argued that British financial firms should not be able to keep their passport to EU markets unless Britain accepts the free movement of people, which Brexit campaigners were against.