French tax office to work with Google to spot undeclared pools

Property tax dodgers trying to hide swimming pools are being targeted by aerial photos and artificial intelligence.

In a €12million deal with Google and IT firm Capgemini, the French tax office will be using the technology to seek out undeclared pools, tennis courts, conservatories and extensions.

Such ‘extras’ should be declared as they change the calculation of the taxe foncière paid by property owners and taxe d’habitation, still paid by higher-rate taxpayers and on second homes.

In a 2017 trial in Marmande, Lot-et-Garonne, tax officials found a third of the 800 swimming pools counted in the town had not been declared.

In 2019, another trial by professional services firm Accenture in three departments showed up 3,000 undeclared pools in Alpes- Maritimes alone.

The new Foncier Innovant system uses Google cloud computing infrastructure and artificial intelligence technology to identify relevant structures – such as outlines of pools and buildings – in aerial images from state geographic body IGN.

They then check if they are subject to the right local tax.

If issues are flagged up, owners will be asked to put their tax affairs in order, potentially paying significant extra local tax. Previously, surveyors had to check each property to confirm if rules were being broken.

Capgemini is involved in a ‘coordination’ role, while Google will provide an ‘after sales’ service, in case of problems.

It is a significant turnaround for Google, which was condemned by French tax authorities two years ago to pay a €500million fine for tax fraud.

Tax officials say Google will not have any access to tax records and that, over time, all 87million ‘cadastral parcels’ (property zones on tax office maps) registered in France will be checked with the new system.

It is being deployed in Alpes- Maritimes, Ardèche, Bouchesdu- Rhône and Maine-et-Loire before an eventual planned rollout nationwide.

The €12million bill will cover Google’s fees and those of Capgemini, and unions have been assured that Capgemini will serve as a buffer between Google and the tax authorities.

The DGFiP, in charge of taxation in France, says Google was picked in a “transparent” invitation to tender process.

The three-year Accenture test in 2019 cost €800,000 but was not pursued as the firm refused to hand over software it had developed for the project.

Precautions have been taken against this happening again, according to the DGFiP, which said: “Our teams will be taking ownership of the technology and we will acquire the intellectual property rights and full control over the algorithms developed.”

It added that the project would “improve the reliability of the information on which local direct taxation is based, make officials’ work easier, help fight more effectively against fraud and better respond to people’s expectations of fairness and fiscal justice through the correct evaluation of properties, and automate updating of the cadastral plans”.

France is thought to have more swimming pools than any other European country.

The trade body for the sector said the symbolic figure of three million pools was broken earlier this year, after nearly 200,000 were built in 2020.

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