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January 22, 2024

France – New Offense of Providing Instruments to Facilitate Tax Fraud

The fight against tax fraud occupies a central place in the French Finance Act for 2024.

Among the various proposals is the new Article 1744 of the French tax code, which creates the offense of making instruments available to facilitate tax fraud and punishes natural or legal entities making available “free of charge or for a fee, one or more legal, tax, accounting or financial means, services, acts or instruments, with the aim of enabling one or more third parties to fraudulently evade the assessment or payment of all or part of taxes.”

Strengthening the penalties for tax fraud

The French legislator's undisguised intention is stated in the explanatory memorandum: "to strengthen the levers for combatting tax fraud, by making it possible to penalize the provision of instruments facilitating such acts".

Therefore, this strengthening of the fight against fraud requires the possibility of initiating criminal proceedings directly against the organizer of a tax fraud scheme, whether or not the scheme was implemented. Until now, such prosecutions were limited to cases where the fraudulent scheme actually had the effect of evading taxes.

The new offense - like money laundering - is independent of the offense of tax fraud and is likely to affect many professionals (accountants and CPA, lawyers, tax specialists and consultants, notaries, private banks etc.) if one of the following means, services, acts or instruments are used:

  1. opening accounts or taking out contracts with entities established abroad,
  2. the interposition of natural or legal persons or any entity, trust or comparable institution established abroad,
  3. the provision of a false identity, false documents or any other falsification,
  4. the provision or justification of a fictitious or artificial tax domicile abroad, or
  5. the carrying out of any other maneuver intended to mislead the administration.

By completing the criminal arsenal against tax fraud and going beyond mere complicity, the aim is “to act as early as possible, independently of any control or prosecution against customers, and to sanction the actions of natural or legal persons who market or make directly available to taxpayers resources, services, acts or legal instruments with the purpose of fraudulently evading tax.”1Finance Bill for 2024 – preliminary assessments of the articles of the Draft Budget for 2024. According to the government, this is "a way of preventing fraud directly for those who offer it"2Volume I of the report made on behalf of the Finance Committee on the Draft Budget for 2024., while at the same time "increasing [the] performance" of the State in collecting taxes.

However, due to its imprecise wording, this provision is open to broad interpretation with regard to the prohibited practices, thus creating legal uncertainty for professionals.

This new offense is part of a trend toward increasing penalties in the tax sector as demonstrated in recent years by various measures such as: 1) the creation of the national brigade for the repression of tax delinquency (brigade nationale de repression de la délinquance fiscale3Decree No. 2010-1318 of 4 November 2010.); 2) the abolition of the “Verrou de Bercy;”4Translates to “Bercy lock”, which was a requirement to obtain a favorable opinion from the tax offenses commission before tax authorities could file a complaint for tax fraud. Article 36 of Law No. 2018-898 of 23 October 2018. or 3) the introduction of fines against tax and legal professionals complicit in tax or social security fraud, fraud or abuse of Law through the intentional provision to a taxpayer of a service directly enabling the sanctioned acts.5Article 19 of law no. 2018-898 of 23 October 2018, instituting article 1740 A bis of the French General Tax Code. The fine is equal to 50% of the revenue derived from the service provided to the taxpayer and may not be less than 10,000 euros.

A highly punishable offense

Article 1744 of the French Tax Code provides for a penalty of three years imprisonment and a fine of 250,000 euros, which may be increased to five years imprisonment and a fine of 500,000 euros if the provision is committed using an online public communication service.

Natural persons guilty of such an offense are also subject to the additional penalties provided for in the event of tax fraud6Article 1741 of the General Tax Code. as well as a ban on practicing a liberal (“profession libérale”), professional, or industrial profession, and a suspension of their driving license.7Article 1750 of the General Tax Code.

Legal entities would risk a fine equal to five times that provided for natural persons (i.e. 1,250,000 euros or 2,500,000 euros) as well as certain additional penalties (dissolution of the legal entity, permanent or up to five year ban from directly or indirectly operating a professional or social activity, exclusion from public procurement contracts, etc.).8Penalties provided for in paragraphs 1 to 6, 9 and 12 of Article 131-39 of the Criminal Code.

These penalties, which are particularly severe and therefore dissuasive, may also prove to be disproportionate to behavior they are intended to punish, which may be as a mere "help" to a taxpayer who may or may not subsequently be used to commit tax fraud. In other words, a professional could be penalized for having provided assistance even if there is no commission of a reprehensible act by the "assisted" taxpayer at the end.


The Finance Act for 2024, including this new offense, was enacted on December 29, 2023 and published in the Journal Officiel on December 30, 2023.

This non-retroactive penal provision comes into force on December 31, 2023.