France mulls tax law to encourage 'snitching'
Malcolm Curtis · 17 Sep 2013, 15:20
Published: 17 Sep 2013 15:20 GMT+02:00
- Disgraced ex-minister's wife charged in tax probe (30 Aug 13)
- Former Geneva bank exec could face charges (14 Jul 13)
- French 'stashed $5 billion in Swiss accounts' (12 Jul 13)
A much-hyped law against tax fraud and financial wrongdoing was given a second reading on Tuesday in the French lower house National Assembly, after Socialist MP Sandrine Mazetier proposed an amendment to encourage convicted tax evaders to turn others over to the "tax police".
The lawmaker has justified the measure by noting that tax fraud in France amounts to “between €60 billion and €80 billion annually”, France's BFM TV reported.
Under the proposal the legislation would cut sentences in half if a convicted tax fraudster provides an administrative or judicial authority with information that allows “other tax dodgers or accomplices to be identified”.
Mazetier said the amendment only applies to a reduction in jail time and cooperative tax evaders “would not be exonerated from tax penalties, fines and damages”.
The Socialist government's new tax fraud legislation aims to crack down on offenders and does away with a scheme under former president Nicolas Sarkozy labelled by left-wingers as a “gift for the wealthy”.
The scheme allowed citizens with undeclared assets outside the country to declare them and negotiate a penalty without admitting to fraudulent intent, BFMTV noted.
Among other things, the new legislation calls for the creation of a “tax police” with special investigative powers, including surveillance and infiltration.
The law would empower the force to confiscate fortunes and authorize all sources of information.
Currently, the maximum penalty for tax fraud in an organized gang is five years in jail.
In addition to raising the prison term to seven years, the legislation would boost the maximum fine to €2 million from the current €500,000.
The law distinguishes between “active” and “passive” tax dodgers, with lower penalties for the latter group.
An example of a passive evader would be a French citizen who has inherited undeclared assets in a Swiss bank account.
The law regards an active tax dodger as someone who personally takes steps to escape paying the taxman.
The bill's reading comes just two days after it was reported two Swiss banks were making efforts to weed out French tax evaders by asking them for proof that they were not dodging any charges.