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France slams Ryanair ‘blackmail’ over job ultimatum

France on Tuesday denounced as "blackmail" an ultimatum from low-cost carrier Ryanair for its French employees to choose between a five-year pay cut or a number of redundancies in an escalating labour dispute.

France slams Ryanair 'blackmail' over job ultimatum
Photo: AFP

The offer from the Dublin-based no-frills carrier, long accused by critics of abrasive labour tactics, comes as the aviation industry grapples with an unprecedented crisis after the collapse in global demand for air travel due to the coronavirus.

“Blackmail is never an option,” Finance Minister Bruno Le Maire told RTL radio. “Jobs will be protected by imaginative solutions, but definitely not through blackmail,” he said.

The aviation industry is facing drastic losses due to the coronavirus pandemic, which has closed borders across the world and paralysed air transport.

Ryanair has already announced plans to axe 3,000 pilot and cabin crew jobs, or 15 percent of staff across its European network.

In France, Ryanair operates from hubs including the Marseille, Toulouse and Bordeaux airports.

The Irish company has told French unions to accept plans to cut wages by 20 percent for pilots and 10 percent for stewards and air hostesses from July 2020, or face the redundancy of 23 pilots and 27 cabin crew staff.

Under current plans, staffers who are earning minimum wage would see their work time cut by 20 percent. Employees would progressively regain their salary up until 2025.

Labour Minister Muriel Pénicaud said she was “shocked” by Ryanair's proposal and said the company must go back to the drawing board and “really talk (with employees), but not blackmail.”

Since 2017 companies can open up talks with its employees on contract hours and salaries in exchange of a company's commitment to suspend dismissals, Pénicaud said on TV station BFM Business.

But the spirit of this possibility is “not at all the one being used by Ryanair,” she said.

Ryanair benefited from the state scheme to help companies through the two-month lockdown period by placing staffers on partial unemployment, Pénicaud said.

“We helped them and they're not playing the game,” she added.

The head of France's biggest trade union CFDT, Laurent Berger, said Ryanair wasn't showing respect to “its employees, nor workers, nor anyone.”

Berger called for a boycott of the airline. “Let's stop taking Ryanair to travel,” he said, accusing the company of “pressuring its employees for years.”

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TAXES

Explained: France’s exit tax

Planning on leaving France? You may, depending on your circumstances, be charged the 'exit tax'.

Explained: France's exit tax

Like some other European countries, France does have an exit tax for those (French or foreign) who are leaving the country. It’s known by the English name l’Exit tax.

However, it won’t affect most people.

Only those who have been tax resident for a minimum six years of the 10 years immediately before they permanently move out of the country are liable to pay an exit tax – if, that is, they own property, titles or rights worth a minimum of €800,000, or that represent 50 percent of a company’s social profits.

If that affects you, the best advice is to seek expert individual financial advice before moving out of France for good. The relevant page on the French government’s impot.gouv.fr website says it is possible to defer payments, and some relief is available.

Because of the relatively high figures involved, this tax is irrelevant for most people. That said, however, you will still have to inform tax authorities that you are moving out of the country because you may still have income, property and capital gains taxes to pay.

Income tax

You must inform the tax office that you are moving and give them your new address so that your tax declarations can be transferred to your new address.

You are liable for tax on everything you earned in France prior to your departure as well as on any French earnings that are taxable in France under international tax treaties that you earned after your departure.

The year of your departure, you declare your previous year’s earnings as normal – declarations in spring 2024 are for earnings in 2023.

A year later, you will have to declare any earnings taxable in France from January 1st up to the date of your departure, and any French-sourced income taxable source until December 31st of the year of your departure.

If you continue to have any French-sourced income – such as from renting out a French property – you will have to declare that income annually, using the non-residents declaration form.

Property taxes

You will have property taxes to pay if you own a French property on January 1st of any given year – whether it is occupied or not. 

Property tax bills come out in the autumn, but they refer to the situation on January 1st of that year, so even if you sell your property you will usually have the pay a final property tax bill the following year.

Moreover, if you receive income from property in France or have rights related to that property (such as shared ownership or stock in property companies), as well as any additional revenue connected to the property, during the year you leave France, you will be required to pay taxes on these earnings.

If any property assets in France exceed €1.3 million on January 1st of a given year, you may also have to pay the wealth tax (IFI).

READ ALSO What is France’s wealth tax and who pays it?

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Capital gains tax 

If you sell your French property or share of a French property, you may be liable for capital gains tax at a rate of 19 percent. It will also be subject to social security contributions at the overall rate of 17.2 percent.

Capital gains tax varies depending on how long you have owned the property and whether it was a second home or your main residence.

READ ALSO How much capital gains tax will I have to pay if I sell my French property?

The good news is, if you move to another EU country, or any country that has a specific tax agreement with France, you may be exempt from capital gains tax for non-resident sellers on the sale of a property that was your principal residence in France.

If you move elsewhere, you may be able to claim exemption on capital gains tax up to €150,000. As always, you should seek expert financial advice.

Tell Social Security

Inform social security that you are leaving France permanently – and return your carte vitale if you have one. If you do not, you may be liable for any benefits you receive to which you are no longer entitled.

More mundane tasks involve informing utility and water companies, your internet provider, if you have one, the phone company, your insurance companies, banks – and La Poste, who will be able to forward your mail for up to 12 months, for a fee…

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