Reversing Direction, France Plans Lower Capital Gains Taxes

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President Francois Hollande will propose next week easing entrepreneurs' capital gains tax, an official in his office told French media on Friday, as the Socialist leader struggles to win the confidence of business owners.

Hollande's government had planned last year to raise capital gains tax on business owners early in its mandate, but backed down after a high-profile revolt and warnings the move would drive start-up companies abroad.

But the episode, and increases in other business taxes, have created a climate of mistrust for the government among business owners at a time when leaders need them to help kick-start the stagnant economy and create jobs.

Eager to dispel the bad blood, Hollande is set to announce plans to reduce the taxable amount of their capital gains by up to 65 percent, Les Echos business newspaper reported on its website on Friday.