French tax authorities use AI to spot undeclared swimming pools

Industry UpdatesPublished 2nd September 2022

The French government is using an AI system to spot thousands of undeclared swimming pools from aerial photographs, bringing in an extra €10m in tax receipts.

French property taxes are based on the property’s rental value, which will be pushed up by the addition of a pool.

French tax authorities use AI to spot undeclared swimming pools

Homeowners are required to declare swimming pools within 90 days of their completion, but it appears that many do not.

The scheme was launched as a trial in October across nine of the country’s 96 regions.

It has so far identified 20,356 undeclared pools and will now be rolled out across France, the government announced this week.

It is estimated that expanding the programme across the whole of France could bring in an additional €40m in taxes.

The AI system was developed by Google and French IT and consulting giant Capgemini.

It analyses publicly available aerial images taken by France’s National Institute of Geographic and Forest Information, with the algorithm trained to identify pools.

Any that are spotted are then cross-referenced with data from national tax and property registries to check whether the pool has been properly declared.

The AI has improved after initially misidentifying pools and other features

The system has had teething problems, with reports suggesting that the AI started off with a high error rate of 30%.

It would sometimes mistake other objects such as solar panels for pools or miss pools that were covered or obscured by trees or other architectural features.

Now, France’s tax office, the General Directorate of Public Finance (DGFiP), says that the issues have been ironed out, with the machine learning algorithms improving.

The DGFiP says that it is looking to expand the system further to look for other taxable home improvements such as extensions.

Antoine Magnant, the deputy director general of public finances, told the French newspaper Le Parisien that they were particularly interested in checking features such as verandas.

He added that they needed to make sure that the technology could differentiate between these types of features and “the dog kennel or the children’s playhouse”.

There are an estimated 3.2 million private pools in France, with demand having increased during the pandemic.

They have also become a contentious issue, however, with some calling for new pools to be banned as France has experienced historic levels of drought.

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