Taxing Times

‘You mark my words, there’ll be blood on the streets within a year,’ a politically moderate woman of Antillean origin told me at the start of the week, just after the presidential election. She spends her days immersed in the news on her computer and I think she was suggesting that our new president won’t be sufficiently severe with France’s North African population to keep them in check and prevent wholesale blood-letting.

It was a text early on Monday morning that informed me of Monsieur Hollande’s victory. My friend must have stayed up much later than I did, awaiting the result of the second round. ‘Congratulations. You wanted a socialist…’ Well, no. I didn’t actually. I like to think of myself as a political pragmatist rather than dogmatist. It wasn’t the fact that our François is a socialist that appealed to me; rather that he appears to be a man with principles and without pretensions. I like the fact that he would bed down for overnight stays in the room above his office in Tulle; that he would sit among the regulars in his local bar, drinking his coffee and eating his croissant; that he would nip around Paris on his three-wheeled scooter. Of course, all that must change now that he is Le Président de la République.

I like the fact, too, that he values education. However, living in the neighbouring department, I also know that – as Député de la Corrèze – yer man was responsible for issuing every child over 11 with a brand new iPad. I understand the logic: that every child should start from exactly the same place on a level playing field. But the expense of such a gesture! The Corrèze is or was the most indebted department in France, so it doesn’t seem to bode well for the future of this indebted nation. It suggests a lifelong resident of Cloud Cuckoo Land, who hasn’t figured out that all men and women may be born equal, but some will always be more equal than others.

Much will be revealed during and after his first meeting with the fearsome Frau Merkel. Our new, bespectacled leader is going along – or so I believe – to renegotiate the terms of some recent financial deal. To a layman like me, it is hard to grasp what exactly they get up to during these tête-à-têtes. Surely a debt is a debt. But maybe he’s going to try out the Greek model of negotiation, which seems to be something like, ‘Unless you lend us more money, we won’t re-pay what you’ve lent us already’.

Who knows? All I’m sure of is that it’s Muggins here – and all my fellow Mugginses, who try to tread a fairly straight and narrow path through life – who will pay for it all. Earlier this week, I spent almost an entire day collecting together all the bits of paper and assorted information to pass to my wife’s overpaid expert comptable so that she can fill in the daunting document that is our annual tax return. This will be one way of paying for it. Another will be our ever-increasing burden of indirect taxation. And another will be the inflationary tinkering of bankers and politicians with the money supply.![](upload://5WYaKTJp7Vy2RuXcUgbUlOgj4qs.jpg)

Really, though, I ought to be able to fill in the document myself after all this time here, but somehow French paperwork still manages to make me ‘break out… in a cold sweat!’ My innate fear of authority is three or four times as intense in France as it is in the U.K. It’s something to do with the sensation of being a figure from a Kafka novel in an environment that he can’t fathom out. It’s as if the French Administration is one huge Castle full of functionaries busy scurrying about down a labyrinth of corridors like ants in a nest. I don’t know what they do in those corridors – probably not work as you or I know it. They appear to be engaged in feeding a voracious Trésor Public. But all I really know for sure as an outsider is that it’s mystifying and kind of scary.

My irrational fear of all things official here has certainly been fuelled by two visits I’ve had to make to the Hôtel des Impôts in the sub-prefecture of Gourdon. Is it just me or does anyone else find that a sinister term, the Hôtel des Impôts? It smacks of Gestapo Headquarters. Certainly during both visits – called in by official letter because of irregularities in our dossier – I’ve felt like someone called in to Gestapo HQ on suspicion of resistant leanings. No one smiles at you, as you wait there for your interrogator, clutching your envelope of assorted documents that, you hope, will prove your innocence.

During the first visit, some female bull terrier put the fear of God in me. I couldn’t quite make out what she was on about, but I remember driving back home thinking that all was completely lost. I would be extradited, our house would be seized and the family would be reduced to seeking shelter at the Marshalsea, or wherever it was that Dickens placed his penurious characters to await the intervention of some obscure kindly benefactor. I didn’t sleep well for a fortnight and I dreaded every trip up our drive to the green metal letterbox. In the end it was nothing worse than a demand for a couple of hundred more euros on the grounds that we – or the overpaid accountant – had claimed a crédit impôt for our new, efficient wood-burning stove in the wrong fiscal year. Or something like that; I still don’t understand.

The second visit was a mere two or three years later. We had been selected, totally at random (we were asked to understand) for a check on our dossier. Since something else was perplexing them, we were invited to attend another interrogation at the Hôtel des Impôts. Because the first one had been so traumatic, I went along this time with my wife for support. We saw another official, who seemed rather more reasonable than the previous harridan. My dear chatty ingenuous wife gave away a little more information than she needed to. Because we converted her ante-room at work from a kitchen into something other than a kitchen (if I understand it correctly), we received a further demand for an extra few hundred euros. I’m still not sure what it was all about, but it sure smacks of victimisation, of ‘let’s see if we can squeeze some more out of these people who don’t know how to work the system’.

Ah well. It was only money. We could ill afford it at the time, but it was better than extradition and incarceration. Nevertheless, it makes me very nervous about the information I forward to the accountant. Which is why it took all day. My nerves and our coffers won’t stand a third visit to the Hôtel des Impôts.

In another few weeks, we’ll receive our demand, the Avis d’Imposition. I never know how much it’s going to be and I certainly don’t know how they calculate the figure involved. We just pay up like the good little citizens we are. It’s the same with the national debt. We have little way of knowing whether the figure that we’re supposed to owe is really what we owe. Either we get the tent out and go and join the protesters, or we pay up. So if yer man François does manage to re-negotiate the terms in our favour, all well and good – but I can’t help but think that it’s going to take some uncommonly creative accounting.

Hi Debbie. Thanks very much. I'm delighted you enjoyed it!

Brilliant article Mark and really enjoyed reading your views and stories...thanks Debbie

Thanks everyone for your interesting comments. Sorry can't work out how to reply to individuals without going through the rigmarole of signing up for friendship! Jo's absolutely right and Iceland is an interesting model (Sweden, too) of how to turn things round. Significantly, the women of Iceland played a prominent role. It's time the fairer sex (in both senses of the word) ousted some of the fat male cats who usually run top financial institutions and the like.

Pam, I'm glad to read that you've stumbled upon someone helpful. Actually, I have to say that I think officials have got a little bit better in recent years. It's often the younger ones, the new intake. I'm tempted to believe that some of these organisations have discovered staff training and customer service.

Thank you for a nice and amusing essay Mark. I guess we all soldier on regardless.

Well said, Jo - also see the piece by Michael Meacher in last weeks Guardian. If a small percentage of people actually paid their dues, the entire national debt would be repaid. Greed, greed and more greed. That is today's mantra - and like a house of cards it will take only the gentlest of breezes to see it come crashing down.

Iceland has definitely found the solution. The gap between rich and poor in europe has grown & is growing faster than ever because the "extra" money generated by capitalizasion is both a sham and has been diverted towards the richest 1000 people in each country. If they paid a fair share of taxes, there would be no deficit. None at all. They could pay the whole deficit, ALL off at once and still share 30 billion profit between them. That's just in one year, and would still give them all plenty more than the rest of us to live on. anything else is just divertionary tactics by politicians who work on behalf of those rich people who own everything. Read this and you'll see what I mean. Also, I don't believe all this nonsense about those in financial institutions being indespensable. Money may be a complex tool at times, but there are plenty of people who understand how it works that would be happy to do those jobs at a hundredth of the cost. They are simply protecting their interests with lies. I don't believe them any more.

Bureaucracy here is a nightmare, but i am pleased to say that the last 2 years we have gone along to our local hotel d'impot's in Mirande where a really nice young man who speaks really slow French and a tiny bit of English has patiently filled our tax returns in for us, (they are quite complicated as my husband works in various countries which, fortunately have had taxation treaties with France). We have come out each time feeling relieved that the taxes he has paid in the countries he worked in more than cover what we would of paid in France and we owe nothing extra. They aren't all evil lol.

As to the new president, aren't politicians all as bad as each other?

I've just been enlightened by someone wanting to sell a 2nd hand car with just 14months CT/MOT left on it on the complexities of parting with a much loved motor and what in the UK is a very simple and straightforward transfer... no wonder you see so many of them rotting in back fields stuffed with wine bottles. So, why be so surprised about systems further up the food chain. If the reported views of M Hollande (Pay Bas?... or should that be 'Pay Back'?) on what the UK gets up to, its PM and its adherence to - and covetousness of 'the City'...One of his first jobs will be the commissioning the prison ships and marshalling us all at Calais docks ready to row back 'home' before the paint's dry on his office door!

I had to go cap in hand to our local tax office in 2006 to ask for an extension of time to pay my TVA bill. The tax officer did give me the extension I needed, after a lot of reasoning and demonstration as to how I was going to repay it. At the end of the meeting he gave me a very valuable piece of information/advice, and it is something we all really already know.

He said "That money is not your money to spend (obviously I'd spent it as there was nothing left to pay with), it belongs to the state, you merely colect it on the state's behalf." ie put it to one side and don't touch it.

Often difficult to achieve, but it is good advice.

I agree wholeheartedly with you however that the system is unecessarily complicated and could be made a lot easier to understand. A simple webtool on the govt, RSI and Urssaf sites would help. An official tool that allows you to put in your revenue and expenditure so that you can stay ontop of the tax and obligatory contributions situation.

There are independent tools that exist such as where you can calculate what you will be due to the various organisations, however I would feel more comfortable if it was an official govt calculator.

Thanks for a good read, Mark. Thus far my own experience of our local Hotel d'Impots has been far less traumatic than I had feared - though I have never yet earned enough to pay tax, apart from the grossly unfair annual business tax. Given up trying to work out the system - One thing I do have to say about your piece however: "...suggesting that our new president won’t be sufficiently severe with France’s North African population to keep them in check." I'm sincerely hoping that unlike the last incumbent, who tried so hard to emulate the fascist FN he sounded like one of them, that FH will actually return a little of the égalité to the Republic - far from deigning to keep any particular race "in check" - the very words fill me with horror.

Take heart Mark I don't think there is one among us who does not feel a little intimidated dealing with the French system and James hit the nail on the head when he said they think we are idiots who can't calculate our own taxes, but to be fair I have heard many a French person say the same thing!

There's a good reason for this. Greg A. Smith, partner at Smith Carmichael Associés in Paris, says a U.S.-French double taxation treaty exempts an American residing in France from French taxes on passive income earned on U.S.-source investments. That includes all U.S.-paid pensions, including Social Security. "The treaty is very favorable for American retirees in France," says Smith.

P.S. The one I can't get to grips with is the social tax - even if on very low pension it still seems very steep.

We have found the tax office very helpful. Our helpful assistant even said she thought we could be "cavalier" about a small issue. Yes - it is even the same word!

Sympathize with you Mark -had to go see my Centre des Impots a couple weeks ago and couldnt eat or sleep for days before hand. My husband kept saying, 'but we haven't done anything wrong, we know we have declared everything ' etc etc, but even so I thought I wouldn't be coming home again! As it turned out, the chap I saw was very helpful and pleasant and I escaped an hour later -none the wiser really about why I'd been called in - but all in one piece, although with a hefty bill, for what I don't know. But I was so relieved I rushed off to the nearest SuperU and bought chocolate and Magnums to celebrate. Even the hefty bill couldn't damp my spirits and temper my relief that I'd got out of there and not been slapped into solitary confinement. What is it about The Taxman that puts the fear of God into 99% of people???

You must have to fill out a french tax return though, as all residents do, unless you are only here for less than the specified time.

Our income varies from year to year, which the french find very difficult to understand, isn't everyone either on a state pension, a civil servant or not simply declaring any extra income so that they stay with the confines of the tax regime they have chosen to operate through?

We had to go to our local Impots a few weeks ago and the young man was very helpful, he even spoke some English and was keen to use it, but he did say that most french people do not have such differences in their annual income and so we may find anomalies from time to time.

I am really looking forward to that!!

couldn't agree more...we go to see the tax inspector in Auch every year, and if he greets us with a big smile on his face, I know we are in trouble!!!!

I don't pay French taxes because I pay the US income taxes and am protected by the French-American Double Taxation Treaty. In the US, we calculate our own taxes by subtracting the deductions from the gross income and then looking up the tax due in the tax tables. It's very open and clear. I don't understand why France has to be so obscure in the manner it calculates the tax owed. I wouldn't trust any business that did business that way. Do they think everyone is so ignorant that they can't calculate their own taxes in the same way we do it in the USA and probably many other countries?