[Analysis] Taxation in 2020 will be resolutely penal!

04/02/20
[Analysis] Taxation in 2020 will be resolutely penal!
New concept of delinquent online platforms, exploitation of data made public by users of social networks, call for denunciation... the 2020 tax bill reinforces the fight against tax fraud and upsets the landscape of digital players in particular. The decryption of Pascale Farey Da Rin, partner at De Gaulle Fleurance & Associés.   Since the law of 23 October 2018 on the fight against tax fraud, measures to crack down on tax evasion, tax avoidance and, consequently, the erosion of the national tax base have been in constant bloom. After fairly effective anti-abuse measures, the tax administration has been working twice as hard and has opted for a more coercive approach. The criminal era of tax practice is opening up a new tax order both for taxpayers (whether companies or individuals) and for their lawyers. Behind the provisions of the IFRIC 23 and DAC 6, which have barbaric and unobtrusive code names, there is a marked desire on the part of the tax authorities to make taxpayers more responsible but also to tighten the grip on what they consider to be criminally reprehensible malpractices. As this criminal approach is part of the digital age, online platforms have been at the forefront of the new provisions of the Finance Act of 2020, in particular the implementation of joint and several liability of operators of platforms hosting the activities of taxable persons without implementing the measures necessary for the recovery of VAT due by the latter[1] or facilitating online distance selling[2]. NAME & SHAME In order to make financial sanctions even more dissuasive, the Finance Act for 2020[3] has even, in line with the reputational sanctions (Name & Shame) that emerged from the law of 23 October 2018 on the fight against tax fraud, ratified the publication on the tax administration's website of a list of platform operators considered to be uncooperative. From NCCTs (non-cooperative states) to NCCFPs (non-cooperative platforms), the finance law for 2020 was only one step forward. Underlying this is the legislator's stated desire to ensure the full cooperation of platform operators, with the spectre of having their identity tarnished since they will be, in the event of repeated non-compliance with their tax obligations on the national territory, presented by name as being among the platforms least respectful of their tax obligations. Thus, there is no doubt that the new concept of delinquent platforms resulting from the Finance Act for 2020, by seeking to ensure transparency and improve competition in the digital sector, is likely to disrupt the landscape of digital players.   CALL FOR DELATION In the same vein as the measures designed to combat tax fraud, dubious tax domiciliation and concealed activities, the Finance Act of 2020[4] has driven the nail in by ratifying the use of data accessible from social networks and online platforms, thus giving tax and customs administrations the possibility of "digging" from the data made public by their users, information to establish and reveal reprehensible tax failures. The practical procedures for implementing such a system will have to be set out in a decree issued by the Conseil d'Etat with the assistance of the CNIL when it involves the use of personal and therefore potentially sensitive data. Still in the same perspective of the fight against fictitious tax domiciliations and the desire to repatriate unduly "relocated" tax bases to France, the Finance Act for 2020[5] introduced a presumption of tax domiciliation in France against the directors of large French companies in a context of management, it is true, highly internationalized. Finally, the loop is closed with a call for denunciation, with the Finance Act for 2020[6] extending the system of tax advisers, perpetuated by the 2018 Anti-Tax Fraud Act, to cases of major tax fraud. From now on, and at least during the two-year trial period planned to test this system, the tax authorities will be able to encourage people outside the public administrations to reveal information of significant tax interest (i.e. with associated financial stakes of more than 100,000 Euros), with the result that they will be compensated! This anthology of measures stemming from the Finance Act for 2020 completes the fiscal and penal arsenal that has been gradually deployed over the past two years or so, leading inevitably to fiscal insecurity and a new approach to the management of tax audits.   [interne id="Id interne"]   ** [1] Article 182 of 2020 Tax Bill. [2] Article 147 of 2020 Tax Bill transposing the EU directive on electronic commerce. [3] Article 149 of 2020 Tax Bill. [4] Article 154 of 2020 Tax Bill. [5] Article 13 of the Finance Act for 2020: will be presumed to have their tax domicile in France the directors (Chairman, Chief Executive Officer, Deputy Chief Executive Officer, members of the Management Board, managers, etc.) of companies whose registered office is in France AND which have an annual turnover in excess of €250 million will be presumed to have their tax domicile in France. [6] Article 174 and 175 of 2020 Tax Bill.
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