Feb 15, 2012, 8:18am ET

French bill would heavily tax cars with over 180 horsepower

The bill will be approved or denied in the next few months.

A group of 19 left-wing deputies from all around France have drafted a bill that aims to impose a 33.3% sales tax on what it calls "luxury cars".



For the purpose of the bill, a luxury car is defined as any new car that has a power output of 180 horsepower or more. A car's retail price and its size are not taken into account.



The bill is an attempt to put much-needed money back in the state's coffers, though the deputies did not say how much the country would earn if the bill is passed.



"In the current economic situation that France is in, it seems necessary to raise taxes on luxury cars in order to help reduce the country's budget deficit," explained the deputies in a statement. "The main appeal of luxury cars is their power, so it is fitting to tax buyers based on that."



Members of the auto industry have loudly spoken out against the bill. Most argue that the deputies' definition of a luxury car is skewed, and that 180 horsepower is too low. According to the bill's guidelines, a Volkswagen Polo GTI falls in the "luxury car" category.



Critics also argue that similar measures taken in the 1960s and 1970s ended up killing French luxury cars, and that the effects of those decisions are still felt today by automakers. Over the years, PSA Peugeot CitroÃ«n and Renault have given up an overwhelming majority of their shares in the luxury car segment to foreign automakers.



A decision on the matter will be taken before the summer of 2012.