Friday, October 11, 2013
During a second reading, the French Senate adopted the Government's anti-tax evasion bill, together with an administrative bill establishing the post of special national prosecutor.
The Government's anti-tax evasion bill is designed to "strengthen the efficiency of the fight against corruption and tax evasion." The draft legislation provides notable for the creation of a "tax police" to combat tax evasion and to clamp down on tax offences.
Furthermore, the text creates an "aggravating circumstance" for the most serious types of fraud, notably tax evasion committed by an organized group, as well as undeclared bank accounts or entities held abroad, such as fiduciaries and trusts. Sanctions include a seven-year prison sentence and EUR2m (USD2.6m) fine.
In addition, the bill "improves" provisions regarding international assistance for the seizure of criminal assets and authorizes the French Tax Administration to "exploit" any information that it receives, irrespective of the origins of that information.
Finally, the bill provides for the creation of a special financial prosecutor, tasked exclusively with the pursuit of complex cases of corruption and tax fraud. Provisions relating to the prosecutor are established via a supplementary administrative bill.
Defending both bills, the Senate highlighted the fact that tax fraud and tax evasion lead to an annual shortfall of fiscal revenue for the state estimated at between EUR60bn and EUR80bn, of which the French Tax Administration recovered just EUR18bn in 2012 through tax controls. The draft legislation is intended to curb such infractions and recoup vital revenue, the Senate ended.