It’s not every day that we get to talk about tax reforms on this site. Especially foreign tax reforms! But a recent change in the tax on capital gains from real property in France may cause several vineyards to sell before February 1 of next year.
French tax code previously had a zero percent tax on property held more than 15 years. No capital gains tax–and this is a land where the candidate from the parti socialiste has a 60-40 lead over the incumbent president? John Boehner must me gnashing his teeth.
The reform, introduced by PM Francois Fillon and ratified last month, would maintain the zero capital gains on property but push the holding period back to thirty years. (To ease the transition somewhat, in the intervening years, sellers will be able to step up their cost basis by the official rate of inflation.) Foreign owners may pay different rates. Here’s how one site calculates the change in tax bills:
A French property bought by a UK resident for €500,000 in 1996 and sold 15 years later for €1m, for example, would not pay any French Capital Gains Tax on the €500,000 profit made.
If the same property, in the same circumstances, was sold after 1 February 2012, only 20% of the profit (€100,000) would be free from taxation. The remaining €400,000 would be subject to 19% tax, resulting in a €76,000 tax bill.
While we’re not so interested in the holiday house market on this site, the net result is that some property holders who have held for about 15 years but not yet thirty may attempt to dump properties before the law goes into effect. That could mean some vineyards will change hands. Developing…
Although we mentioned it last week in a squib, it bears mentioning again: the French authorities have threatened Olivier Cousin, the horse-tilling vigneron that is a mentor for many younger ones, has been threatened with a $50,000 fine and two years in jail.
His transgression? Goofing around with names. The biodyanamic farmer of 25 acres in Anjou told Jim Budd that he left the AOC system in 2003 because it was too lax. “I stopped because the AOC is for industrial wines as the rules permit everything: weedkillers, huge yields, additives etc.” He thus marketed his wines as vin de table, the category at the bottom of the French administrative category as few are bold enough to do (as I detailed in Wine Politics). He marketed one of his wines as “Anjou Pur Breton,” which somehow made it past the authorities for several years despite containing a place name and a grape name (Breton is a local name for Cabernet Franc).
His distributor wrote “AOC” allegedly for “Anjou Olivier Cousin” on cases of his wines. This, coupled with his refusal to pay obligatory dues to an association, was the straw that broke the administrative camel’s back: He has been threatened with a significant fine, possible jail time, and one of his bank accounts have been impounded. The decision of how to proceed now lies with a prosecutor in Angers.
The crackdown on this sympathetic figure appears to have backfired. Thanks to the global reach of the internet, awareness of his treatment is high. Over 500 people have signed a petition on a French blog, his American importer is also mounting a campaign for signatures, and his UK importer is helping pay his legal bills. It’s sad that the Loire, site of so many distinctive wines that offer France a calling card overseas, is also the site of clashes with a moribund bureaucracy.
What’s the best white wine currently in the US market for about $15? I’ll make a case for the 2010 Clos des Briords from Marc Ollivier (Domaine de la Pépière).
The 2010 is electric. After the 2009 had more ripeness, I find 2010 a reversion to the exciting norm of citrusy freshness and minerally, iodiney verve. Pairing it with seafood, particularly shellfish, is probably about as much fun as you can have with a $15 white wine. (search for this wine at retail) The wine comes from a single vineyard in Muscadet, one of vines planted in the 1930s. The wine stays on its lees up until bottling, which also helps account for more depth than your average Muscadet. It’s also particularly age-worthy, and I’m scouting out some magnums to tuck away. Emphasizing the minerailty over fruitiness means this wine isn’t for everyone. But for those who love wines so taut you could play a DVD on them, check out what is the best white value out there.
A runner-up would certainly be the Terres Dorées Beaujolais Blanc, a Chardonnay, also from 2010 (above, left). The wine is a perennial better value, but the 2010 exhibits a value chardonnay in its minerally, unadorned form that is stunning. (On a related note, I was a huge fan of the 2009 red Terres Dorees, but didn’t find the 2010 red to have the same snap.)
Which wine would you nominate as the best white wine around $15 in the market today?
The best bottles are the quickest emptied. But you knew that.
Last week, I made my wife a birthday dinner. But before I started covering the kitchen counter and, inadvertently, the floor and my clothes with flour to make fresh pasta, I popped open a bottle of slightly chilled Mugnier Clos de la Marechale 2007. By the time we got to the table, I was dismayed to find most of the wine had evaporated!
The 2007 Clos de la Marechale is drinking very well now. I had the good fortune of tasting the 08 and the 09 this week too at a trade tasting. While the 07 is the least heralded of these vintages, it is certainly not one to overlook with delicious balance of fruit, acidity and tannin. The ’08 has more red berry notes, acidity, tannin, balance and gorgeous oomph that bodes well for a long cellar life. The ’09 has more dark fruit character, slightly more ripeness and roundness and elegant concentration, with a spice note that culminates an a faint whiff of pepper. All bear the signature of Frédérique Mugnier for the “bargain” price of under $100. (Find these wines)
Peter Wasserman, who works to export the wines, told me that “Freddy” Mugnier, the winemaker and a former petrochemical engineer, has undertaken a geological survey of the vineyard this year. While the wine making remains very hands-off, for the first time, he will be harvesting the grapes from similar soils and making the wines by those parcels instead of by vine age (45 – 70 years old). All the vats will still be blended in to the 2011 Clos de la Marechale.
Well, wonder no more. San Francisco architect and professor David Gissen worked up just such a map; now it is available for purchase as a cool 18 x 24 wall decoration. Each region gets its own color like one of the subway lines and the subregions are various stops. Here’s what Gissen said via email about his inspiration for the map:
I guess I made the map as a sort of loving critique. I feel that the American appreciation of EU wine is dominated by a pastoralist point of view and aesthetic. If I see another picture of a vineyard or pruning shears, or a wine map that looks like a hiking map, I might lose it. I believe that French wine (like all EU wine) was born in and through villages, towns and cities. From my perspective it’s completely urban. I want to make some artifacts that express my point of view. The map is the first of these. I may make others, but I’m not sure. Of course, if you need to learn the appellations, the metro-wine map is useful, but I’m not primarily interested in its instrumentality. I’m more interested in its ability to shift what we understand wine to be.
And things are heating up in talking about weather in the wine world. Especially if you are in Bordeaux that is, since it is en fuego! Or something like that: The heat has been abnormally high and the rainfall is way below average. So if the drought-like conditions keep up, the reduced supply of grapes could push wine prices even higher! Is it 2003 all over again? The vintage in Burgundy is also advanced.
By contrast, cut to the Auction Napa Valley this past weekend and people were breaking out the umbrellas rather than the sunscreen. Weather has been cool across the state. Rhys Vineyards has vineyards in more of the marginal weather areas of California and therefore is rightfully weather-obsessed, so their Twitter feed is an excellent source of weather info. Temperatures at their Skyline Vineyard, perched at 2,300-ft elevation, hovered at 49.6 degrees Fahrenheit in May, making it one of the seven coldest Mays since 1931; their vine shoots are about two or three inches behind, they tweet. They say that weather in late June is key for the fruit set so they don’t mean to sound gloomy. And after California’s cool and damp 2010 vintage, the “high-octane,” “fruit-bomb” style is taking it from all sides these days.
Australia was in the headlines for the devastating Queensland floods earlier this year. But even some of the wine growing regions were hit by heavy, “seven year rains” that rotted unpicked grapes quickly and made for a lot of grape selection both in the vineyard and on sorting tables. The Sydney Morning Herald explicitly linked the “soggy” weather to lower alcohol levels.
It’s weird that California and France appear to have flipped weather so far for 2011–there’s something you can talk about in your next elevator ride. Just don’t let the Mayans know since I think that was part of their their 2012 prophecy…
Muscadet gives pleasure when it is freshly squeezed. But aging the best examples can be worth the wait.
Muscadet gains richness with time spent on the lees. Lees are neither Confederate generals nor blue jeans but rather spent yeast cells that fall to the bottom of the barrel or tank when their work is done. Stirring them can give a wine a broader, heftier feeling–without at all adding woodiness.
At Luneau-Papin, the wines not only highlight different soil types, but also different lees aging.The tasty “L d’Or” comes from both granite and gneiss soils and sees 11 months on the lees. (This wine can also do well with extended aging in bottle as the 1999 I recently tasted was fresh and delicious.) The golden “Excelsior” bottling, from schist soils, sees 36 months on the lees and is creamier and richer. Their structured “Peuri Solis” sees 42 months on the lees before bottling.
As the name of the grape (Melon de Bourgonge) suggests, it originally hailed from Burgundy. Some juice from Pierre Luneau-Papin’s vineyards recently made a trip back to Burgundy to be made into wine by none other than the maestro J-F Coche, making me wonder if it would be, in fact, be a Melon de Meursault. A call to Coche (he has no email or website I could find) divulged that he had, in fact, mad a “miniscule” amount of Melon de Bourgogne. Coche-Dury has been known to drive wine enthusiasts to the brink of their senses in seeking out his wines. Alas, this curiosity won’t ever be available commercially as Coche says it for “personal consumption.” But it sure would be fun to try! Read more…
A case study is unfolding in France. On January 1, a small wine producer going by the name of “Olivier B.” announced on his web site that he was hanging it up. He makes a range of reds and whites from the Côtes du Ventoux appellation that sell for about 12 – 30 euros. He put a picture of his bottles in the shape of a cross, with the hat that adorns the labels of all his wines in the middle, and said it had been his cross to bear for the past few years and the dream was over. His love was lost, both the winery and his parter (simply, “elle”) who said she could not support him any more in this venture. The warehouse where he made his wine was for sale and the bank wouldn’t grant him a line of credit to buy it.
The French blogosphere then turned Olivier B. into a cause celebre for the misfortune of small vignerons. Many rallied to his cause (see a summary). Two bloggers organized a public tasting of his wines in Paris. The big breakthrough appears to have been when the Miss Glou Glou blog at lemonde chimed in. Then a local paper, La Provence, picked up his story. Then AFP ran a story. The media tsunami continued with TV channel Canal+ and radio stations from France, Belgium and Switzerland running stories. Traffic to his blog took off. But more importantly, sales started flowing, and he had 20,000 euros of sales in two weeks.
He wrote in a posting on his blog that making “Parkerized” wines was never his objective but during his deepest, darkest moments, he did think that if he got a 95-point score from Parker that all his problems would be solved. But now, he says, thanks to the blogosphere he has “hundreds of Parkers” to thank for the turnaround.
This fascinating story isn’t over, of course. Check out Olivier’s blog for the latest. One interesting aspect is that despite the apparent globalization of the internet, this story hasn’t reached the English language blogosphere or media. Another is that the blogosphere rallied in an advocacy mode. Whether and how many times it could be repeated is an open question. But certainly Olivier B. is glad it has worked so well this time.