Undeclared self-employment earnings cost France €7billion a year

New estimates of the cost of people working au noir (on the black, ie. without declaring earnings) have been put at more than €7billion a year after tax officials cross-referenced declarations from firms such as Uber with those from its workers.

Now the government agency charged with overseeing the financing of social security –something politicians in France insist is not tax-related, while most people call it a tax – says it might require platforms to take social security payments from the wages of people who work for them.

Read more: Deliveroo France on trial in Paris for abuse of freelance work status

90% drivers do not declare earnings

The Haut conseil du financement de la protection sociale (HCFiPS) says figures from web-based work platforms showed two out of three auto-entrepreneurs (self-employed workers) who declared their revenue under-declared what they had received.

Around half made no declaration at all.

The sector with the worst record was drivers registered as VTC (voiture de transport avec chauffeur), under which most Uber drivers fall.

Here, 90% of drivers were not declaring earnings, followed by takeaway delivery workers (73% did not).

Auto-entrepreneurs in the construction industry are also believed to under-declare.

They are thought to be responsible for most of the €1-€1.5billion lost in social security contributions, an analysis of bills presented by builders found.

Read more: A guide to micro-entrepreneurs in France

Undercutting those who declare correctly

The figures confirm estimates published in 2021 before comparisons of web platform and worker declarations had been fully analysed.

Dominique Libault, HCFiPS president, said: “There is a real problem with auto-entrepreneurs and web platform workers.

“It is not just a problem with a lack of money for social security but also the whole question of people undercutting other workers in the system who make proper declarations.”

He said he knew that the platforms in question, such as Uber, would argue they are not employers, in the traditional sense, of the drivers and delivery people who work for them.

“But even so, we can ask them to take social security contributions, because the figures show it is a sector where workers are weak in paying their dues and doing basic administration.

“It is a sector where many youngsters drift in and out of work.”

Workplace inspections due to restart

Overall, private sector employers are thought to pay between 2.2% and 2.7% of workers au noir, representing a loss of social security contributions of €5.1 to €6.4 billion.

Added to this figure are unpaid contributions to unemployment insurance, bringing it up to €7billion.

Farmers, vineyard owners and market gardeners are thought to under-declare work by €500million.

The HCFiPS warned that workplace inspections, suspended during Covid lockdowns, would be starting again. These will focus on VTC drivers and building sites, where the analysis has shown that problems lie.

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