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French more honest taxpayers than Germans

A study has found that French workers are more honest than their German or Scandinavian counterparts, when it comes to declaring their income to the taxman.

French more honest taxpayers than Germans
Photo: Images of Money/Flickr

According to the annual survey by German economic institute IAW, the black market in France represented 9.9 percent of the country's GDP.

That compares favourably to Germany, where undeclared economic activity totaled 13.2 percent of GDP, and Sweden, where 13.9 percent of the country's GDP is accounted for by the shadow economy.

Does this mean the French are more virtuous than their European counterparts?

Not according Friedrich Schneider, co-author of the study, published this week by French website Challenges.fr,

Schneider attributed the French performance to a particularly efficient tax system, with stricter controls against cheating the system.

“Taxpayers here are given incentives to not resort to black-market work,” the economics professor told Challenges.fr.

Reduced VAT rates for the hospitality and construction industries also accounted for the fact the French were less likely to resort to the black market than the Germans,  according to Schneider.

The study found that of the 21 countries surveyed, the champions of the black market were the Greeks, where the shadow economy represented 24.6 percent of GDP. They were closely followed by the Italians (21.1%), the Portuguese (19%) and the Spanish (18.6%).

At the other end of the chart were France's near-neighbours Switzerland, where the equivalent of 7 percent of their GDP was concealed from the tax man.

For the 12th year in a row, however, the world’s most honest taxpayers, at just 6.6 percent, were the Americans.

Economic earnings through criminal activity were not taken into account by the study.

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