Gérard Depardieu: From Russia With Love?

 @Gooch700
on January 03 2013 11:45 AM
Depardieu
Depardieu plane incident blamed on health problems Reuters

Legendary French film actor Gérard Depardieu, who plans to relocate to Belgium to escape France’s draconian new tax rates on wealthy residents, could move 1,500 miles to the east if he likes.

The president of Russia, Vladimir Putin, signed a decree on Thursday granting Russian citizenship to the movie star, according to the Kremlin website.

"If Gerard wants to have a residence permit or a Russian passport, it is a done deal, and positively," Putin said at a press conference last month.

"I'm sure the French authorities did not want to offend Mr. Depardieu.”

Putin added, perhaps to appease the French government: “I understand Mr. Depardieu's feelings. We have established very pleasant personal relations, friendly relations, even though we haven’t seen each other often, and I know that he considers himself a Frenchman, he loves his country very much, its history and culture; he lives it.”

Prime Minister Dmitry Medvedev seconded the invitation for Depardieu to move to Russia, where the personal income tax is a flat 13 percent.

Depardieu has not yet responded to the latest Russian offer, the BBC reported. His publicist Francois Hassan Guerrar told Reuters he would not comment on the announcement.

Depardieu, who purchased a property in Néchin, Belgium, located just across the French border, late last year, reportedly still plans to settle there.

France’s Le Monde newspaper reported that the actor has discussed the possibility of moving to Moscow before.

"Putin has already sent me a passport," he reportedly told friends at a restaurant on Rue du Cherche-Midi in Paris last month. However, the following day, Kremlin spokesman Dmitry Peskov refuted that statement, saying "Depardieu was evidently joking."

Depardieu apparently has a relationship not only with Putin, but other Eastern leaders of questionable ethics.

Le Monde noted that he also has a relationship with the autocratic president of the Caucasus republic of Chechnya, Ramzan Kadyrov, who is suspected of committing grave human rights abuses. Depardieu even attended a celebration in the Chechen capital of Grozny last October, where he shouted: "Glory in Grozny, glory Chechnya, Kadyrov glory!"

In fact, the Chechens would also like Depardieu to live there. A spokesman for Kadyrov told Moscow Echo radio on Thursday: "We confirm that if Depardieu wants to settle in Chechnya, it will be very appreciated. The conditions necessary for a good life and creative work will be implemented.”

Depardieu also has ties with yet another controversial leader of Central Asia, Islam Karimov, the president of Uzbekistan. The French actor even recorded a duet with Karimov’s eldest daughter, Gulnara Karimova. On a trip to the country in December, Depardieu agreed to appear in a local television series co-written by Karimova.

Montenegro, a tiny country that was formerly part of Yugoslavia, also offered a tax haven to Depardieu.

Depardieu is extremely popular in Russia, Le Monde noted, having appeared in many television commercials and participated in various film festivals in Moscow. In addition, Depardieu portrayed the eccentric Russian mystic and monk Grigory Rasputin in the French-Russian film “Raspoutine” released last year.

Meanwhile, the French government issued rather a terse and annoyed response to the whole affair.

Najat Belkacem-Vallaud, spokesman for Socialist President Francois Hollande, said it is "the exclusive prerogative of the head of the Russian state, it does not really call any comment from me, it is a choice of the head of the Russian state," during an interview with reporters.

Hollande has proposed a 75 percent tax rate on French residents who earn at least 1 million euros per year, which he is determined to implement by next year, in defiance of a recent decision by the French Constitutional Council to censure the new tax. Depardieu has declared that the measure by the council will not affect his decision to move to Belgium (which boasts an income tax of 50 percent). France’s wealthiest citizen, luxury magnate Bernard Arnault, has already revealed he will relocate to Belgium.

Depardieu has come under fire from French officials for his desire to escape France’s high tax rates.

Hollande, while not mentioning Depardieu by name, said in mid-December, "everybody must have an ethical behavior," reported Agence France Presse. He also hinted at the possibility that France might "revise [its] fiscal agreements" with Belgium "to address the cases of those who took up residence in some Belgian village," a direct reference to the actor.

Last month, Prime Minister Jean-Marc Ayrault called Depardieu’s planned move "shabby” and “pathetic” and questioned the actor’s patriotism.

Ayrault’s verbal harangue was apparently the last straw for Depardieu, who immediately declared he would relinquish his French passport.

"I am not asking to be approved of, but I could at least be respected. All of those who have left France have not been insulted as I have been," Depardieu told the French weekly Le Journal du Dimanche.

“I am leaving because you consider that success, creation, talent, anything different, must be punished.”

Depardieu claimed that over his long and illustrious career he has paid out 145 million euros ($191 million) in taxes.

"At no time have I failed in my duties. The historic films in which I took part bear witness to my love of France and its history," he said.

Taking specific aim at Ayrault, Depardieu glowered: "Who are you to judge me in this way?"

Two of France’s most famous actresses, Brigitte Bardot and Catherine Deneuve, have expressed their support for Depardieu.

In December, Bardot said: "I support Gerard Depardieu, who is the victim of an extremely unjust persecution. ...  an exceptional actor who represents France with his unique popularity and celebrity," according to French press reports.

In the unlikely event that Depardieu takes up Russian citizenship, he would be able to physically reside in Belgium.

Georges Dallemagne, head of Belgium's parliamentary committee that oversees naturalizations, told Reuters: "As a Russian he could certainly remain in Belgium, he would possibly need the necessary visas but for a short period he could stay here. He would need to request a residency permit for longer stays but as a Russian he should be able to get that. It depends on certain factors.”

Russia boasts one of the lowest personal income tax rates in the Western hemisphere, while the corporate tax rate (20 percent) is also modest.

But a reader of The Economist noted that the low flat-tax rate in Russia likely encourages corruption.

“Russia's tax rates are too low for their country's comfort,” he wrote.

“Taxes are needed to pay for policemen, bureaucrats, judges and administrations that help keep order in the country. Corruption will continue in Russia unless they realize their low tax rates are negatively affecting their operation of their country. Even raising their tax rates over a longer period of time would be more effective for their country's safety [than] not doing anything about it at all. However, the sooner they rise, the sooner peace will result throughout Russia.”

In an analysis of Russia’s flat tax code, Denvil R. Duncan, assistant professor at School of Public and Environmental Affairs at Indiana University, commented that there is some empirical evidence suggesting the tax rate affected income inequality two ways.

“First, lower tax rates on the rich reduced their tax liability relative to that of the poor, which led to a mechanical increase in net income of the rich relative to the poor,” he wrote.

“Concurrently, lower tax rates led to income shifting and real productivity responses, which increased gross (and hence net) income of the rich relative to the poor.”

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