France's poorest pensioners to lose hundreds in health tax hike

Pensioners took to the streets of Paris and other French cities on Thursday to protest against extra health care tax that will affect their pensions. The plans were unveiled in this week's budget aimed at boosting purchasing power. But the elderly feel they’re losing out.

French pensioners protest against government plans to reform pension system, in Paris, France, September 28, 2017. The placard (R) reads: "Lazy pensioners, but not cash cows" REUTERS/Stephane Mahe

It's not every day you see hundreds of elderly French men and women ambling through cities across the country brandishing placards decrying the state. Let alone be watched over by riot police. But that was the scene of Thursday's protests.

Bernard, dressed in a raincoat and carrying a walking stick, says the government's extra healthcare tax will hit the poor the hardest.

"We're constantly being bled dry, our pensions haven't increased in four years. Personally, I don't mind paying a bit extra, but why is it always us? On the other hand, the wealth tax will be cut and the wealthiest will pay less and less."

Reforms to the wealth tax were unveiled in the government's budget on Wednesday.

Under the changes, profit from financial investments will be taxed at a flat rate of 30 percent, rather than under a progressive regime.

And properties worth less than 1.3 million euros will be exempt from the tax altogether, a gift likely to benefit France's wealthiest households.

"I mean it's ridiculously wrong! It's money for the rich that's all," said Charles, a retired English teacher.

French President Emmanuel Macron has said he hopes with extra money in their pockets, the rich will reinvest in the economy and create jobs to drive down unemployment still stubbornly high.

"We want equality"

"It's not because you increase a little tax on old people that it's going to improve the economy," reckons Charles. "It's hoping that when the rich are richer they will give a little money to the poor. But we don't want charity, we want equality, it's unbearable, it's really unbearable!"

Unions say that pensioners earning 1,000 euros per month will lose about 17 euros of that in the tax increase that goes into effect in January. And those earning 2,000 euros will lose double that amount.

Emmanuel Macron has said that the increase in healthcare tax will pay for scrapping housing tax, which is set to disappear altogether in the next three years.

Marylene Cahouet, a former literature teacher, says that three years is a long time to wait.

"Tax the rich"

"First of all housing tax is a measure that won't be applied straight away," says Marylene. "And then there are a large number of pensioners who are already exempt from this tax so this doesn't change anything. This government thinks that all pensioners are privileged and wealthy if they receive more than 1,200 euros per month. That's nonsense."

The average income of pensioners in France is 1,306 euros, 200 euros above the
poverty line.

Pensioners say their incomes have deteriorated over the years, and that they simply can't afford another cut to their pensions.

One placard summed up the mood at Thursday’s demonstration: “Don’t slash pensions. Go tax the rich.”