overseas tax loopholes conducive to fraud in the government’s sights

2023-10-20 12:30:07

To defend the overseas tax loopholes that the State wants to reform, parliamentarians are once again closing ranks: questions to the government from the opening of the budgetary debates in the National Assembly, Tuesday October 17, amendments to the finance bill for 2024 and political consensus. With them, the Federation of Overseas Businesses (Fedom), a employers’ lobby in the territories, contested, on Monday, the planned elimination of aid from the productive investment support scheme – this costs the State 827 million euros, out of a total of 6.8 billion in tax expenditure in favor of overseas territories.

Read also, on the 2023 budget: The government saves nearly 1 billion tax loopholes for overseas

For 2024, the government wants to eliminate tax loopholes on solar water heaters, furnished tourist accommodation and rental of tourist vehicles – or 160 million euros in reductions. On these assets, “thousands of jobs, particularly in the tourism sector, will be directly impacted”attacks Hervé Mariton, the president of Fedom.

“For the department of Guadeloupe alone, the CCI [chambre de commerce et d’industrie] estimates that more than 3,000 jobs would be impacted. Once again, the Macron government has seen fit to strike overseas”denounced, Tuesday, the socialist deputy of Guadeloupe Elie Califer, in a press release, while his colleague from Reunion, Nathalie Bassire (Libertés independents overseas et Territoires) questioned the Prime Minister in session.

“TVs, connected watches, hair straighteners”

Opacity, inefficiency, abuse: the General Finance Inspectorate (IGF) has just, after studying 3,900 companies, contested the relevance of these tax exemptions. In 2018, the Treasury Department advocated the abolition of the regime.

In his report published on October 13, just before the budget discussion, the IGF recalls that the system remains poorly targeted and poorly controlled. Tax aid for investment, captured by large economic players, does not correspond to the overseas productive fabric, made up of small businesses. These “sometimes have difficulty building files to obtain tax assistance. Microenterprises are also excluded from the tax credit », noted the IGF. Besides the fact that we “found among the tax-exempt assets televisions, connected watches, hair straighteners and even mobile phones”which reveals a complete deviation of the device, the diet does not produce “no significant effect on the development of beneficiary companies”she concludes.

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