Bernard Arnault slams French tax hikes, considers investing more in Trump’s US

“I’ve just come back from the USA and I could see the wind of optimism reigning in that country. And when you come back to France, it’s a bit of a cold shower,” Arnault said.

French lawmakers are on Thursday set to begin negotiations on Prime Minister François Bayrou’s proposed 2025 budget, which includes €53 billion worth of tax hikes and spending cuts meant to rein in France’s skyrocketing budget deficit. Among those measures is an increase in the corporate tax rate which would climb to to 41.2 percent for profitable corporations with a turnover of more than €3 billion, such as LVMH.

Finance Minister Eric Lombard said that exceptional measure would only be in place for one year, but Arnault doesn’t buy that promise. “Nobody believes it,” he said on the sidelines of the press conference, French daily Le Figaro reported.

Civil Service Minister Laurent Marcangeli responded by saying the tax hike was “a necessary evil” in an interview with France’s RTL on Wednesday.

With the economic outlook in France looking grim, Arnault said LVMH, which owns Louis Vuitton, Dior, Fendi and Moët & Chandon, is “seriously” considering opening more factories in the United States. Such a move would help the company to avoid the tariffs Trump has promised to enact on foreign goods sold in the United States.

Trump invited foreign businesses to come set up shop in his country during a virtual appearance at the World Economic Forum in Davos, Switzerland, last week.

“My message to every business in the world is very simple: Come make your product in America and we’ll give you among the lowest taxes of any nation on earth,” Trump said. “If you don’t make your product in America, which is your prerogative, you will have to pay a tariff.”