The Tax Authority's New Methods for Tracking Down Tax Evaders
A decree currently being drafted, which is set to take effect soon, will formalize new methods approved by Parliament in the fall of 2023 for investigating tax fraud.
Tax investigators will now be authorized to create fake social media accounts and interact anonymously with suspects as part of their investigations.
During the vote on the 2024 Finance Act in the fall of 2023, new measures were adopted to penalize tax evaders. Among these, a measure allowing for the revocation of tax credits and deductions in the most serious cases was approved by members of the National Assembly. In addition, the legislation will now authorize tax officials to monitor taxpayers on social media, as reported by Capital on Monday, January 22, 2024.
Previously, the tax authorities were limited in their ability to contact individuals on platforms that require users to create an account—such as Facebook or Instagram—as part of an investigation. Going forward, they will be able to collect "any publicly available information on online platforms," including social media.
In addition, agents will be able to create fake accounts using pseudonyms without facing criminal liability. This will allow them to engage in online communications under a false name with individuals who are the subject of investigations. This measure enables tax agents to communicate with taxpayers suspected of tax fraud online without those taxpayers knowing their true identities.
However, these powers will be reserved for civil servants who hold at least the rank of public finance auditor and have been specifically authorized. Furthermore, they will apply only in the context of investigations into the most serious offenses, carrying the most severe penalties, such as failure to report income, the use of false documents, or the concealment of foreign bank accounts.
These new rules are part of an online data collection pilot program launched in 2020 to identify significant violations of tax laws. A forthcoming decree will specify the procedures for implementing these measures.
