Parliamentary Report Urges Tougher Action Against Tax Evasion, Citing Significant Profit Potential

A parliamentary report has described the French government’s efforts to combat tax evasion as “insufficient” and recommended increasing resources and staff for the fight against fraud. The report, which was written by Special rapporteur Charlotte Leduc (LFI), estimated that tax fraud in France is between 80 to 120 billion euros and called for massive investments in the fight against fraud.

The report emphasized the international dimension of the fight against tax fraud and called on France to be at the forefront of tax diplomacy. It also recommended increasing the minimum tax on corporate profits to 25%, addressing assets of billionaires, and implementing unitary taxation for multinationals.

Concerns were raised about a drop in staff within the General Directorate of Public Finances and the need for more firmness towards tax havens and measures surrounding “transfer pricing”. The report also advocated for the use of new technologies such as data mining, while emphasizing the importance of strengthening human expertise.

Despite using new technologies, the report noted that amounts collected by tax authorities after audits have not significantly increased. There were concerns about using data mining software provided by private companies, which poses problems with sovereignty and security.

This is Charlotte Leduc’s second annual report on tax evasion in France, which pointed out that none of her recommendations from last year had been implemented. The Court of Auditors has also called on the government to define a strategy for detecting individual-level tax fraud by 2024, as it remains an underdeveloped area of their anti-fraud plan.