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If tax authorities use artificial intelligence

If tax authorities use artificial intelligence

France has more than 3.2 million swimming pools. Only the United States has more. For local authorities, such swimming pools generate tax money, if properly advertised.

So the French Directorate General of Public Finance (DGFiP) decided to expose unauthorized swimming pools using aerial photos and artificial intelligence (AI). The software, developed by Google and the French company Capgemini, recognizes swimming pools on aerial photos and compares the data with the official records of the tax authorities. It was only a first pilot project in nine divisions, but the program had already found more than 20,000 swimming pools that the tax authorities were unaware of.

according to DGFiP Which brought in just under 10 million euros. “This is additional income for the respective municipalities for 2022 alone,” explains DGFiP. The government service estimates that the project will bring in 40 million euros in 2023. The cost is estimated at 24 million euros, for the period from 2021 to 2023. The tax authorities want to extend the program to the rest of France. Over time, the software can also detect garden homes and verandas.

In the long run, the program can also detect illegal balconies

As in Belgium, real estate tax is calculated based on the rental value of the house. Swimming pools that cannot be moved are a capital gain and increase the rental value, thus increasing the tax payable.

Previously in Athens

Since the lockdown began, many French people have built a swimming pool. In 2021, 22.5 percent more new swimming pools were built compared to the previous year.

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The experience was met with a lot of criticism at first. Trade unions said the intervention was essentially a cost-saving process for employees. The system will also have a margin of error of 30 percent, which means that inspectors still have to visit.

This isn’t the first time the IRS has used aerial photos to detect unauthorized swimming pools. In 2011, authorities found nearly 17,000 swimming pools near Athens thanks to satellite images. Only 324 of these are declared to the tax authorities.