According to Christine Lagarde, France’s Finance Minister, the French government does not believe that taxing bank bonuses will cause traders and financial operations to leave Paris.

In an interview published by Le Figaro today, Mme Lagarde is quoted as saying that France will enact a law as early as the end of March levying a 50 percent tax on bonuses above €27,500,  regardless of whether they are paid in cash or shares; affecting some 2,500 bankers.

Nicolas Sarkozy, the height-challenged president of France, has chosen yet another glamour girl to join his cabinet (or should that be “harem”).  The former television presenter, Christine Kelly, who also happens to look great in a bikini, has been made Minister for Overseas Territories.

It may have taken over four years in the making but on the 19 June 2008 a new version of the double taxation treaty between France and the UK was finally signed by the Rt. Hon Alistair Darling MP, Chancellor of the Exchequer, and Mme Christine Lagarde, the French Minister for the Economy, Industry and Employment.

The new treaty is expected to enter into force some time late 2009 provided all treaty adoption procedures (i.e. parliamentary approval, ratification and exchange of diplomatic notes) are completed.

Below is a summary of some of the key elements which could affect British citizens living in or moving to France should the new draft of the treaty be ratified and become law.

Delayed Wealth tax liability