Qui profite de nos impôts ? (intégrale) - Cash investigation

Good morning ! How are you ? Good morning. Are there any questions in the report? Yes, you are a real pro. Good evening and welcome to the wonderful world of state business. A year after the start of the Yellow Vest movement, we are offering you an exceptional issue this evening on an issue that unleashes passions: taxes. Each President of the Republic has made his own tax reform. For Emmanuel Macron, it will be the abolition of the ISF, the wealth tax, a strong symbol which struck public opinion. François Hollande created the CICE, Nicolas Sarkozy boosted the CIR, the Research Tax Credit. On the right and on the left, one objective: to revive growth and create jobs. But these devices cost billions of euros to the state coffers, but also... To us the taxpayers. So are these tax reforms fair, are they effective? We scrutinized them. Who benefits from our taxes? This is an investigation by Sophie Roland and Julie Pichot. Like us, you watched this series. It was broadcast continuously for two weeks. The discontent against the rise in fuel prices continues to grow. The first episode is in the fall of 2018. For taxes, everything, for everything, we get fucked everywhere. It started like that. We all have a yellow vest in the car. Highlight it on the dashboard. The new symbol of social struggle had just been invented. Macron returns the money you gave to the rich! It's a question of justice! It's a question of stopping giving only to the rich and not giving to the poor. The president decides to take control again. When violence is unleashed, freedom ceases. At the beginning of all this, I don't forget that there is anger. But I deeply believe that we can find a way out of this together. This path is the great debate. That's the problem, we pay too much tax. People have had enough. Pay 10 cents more for fuel, if we know that the energy transition is going well, but we have no idea where the money is going. And I would like to say that I do not refuse to pay taxes, but above all people want it to be fair. This revolt is obviously much more than a series. For us, this is the start of an investigation. They come straight out of the Elysée Palace. Each President of the Republic has shaped his own. I believe in granting it. For our society to get better, we need successful people. This is what I propose... There is only one possible strategy. These are the major tax reforms. For a decade, they have all aimed to revive growth, investment and above all employment. They cost our public finances billions of euros. But do they have a real impact on our economy? And are they fair to taxpayers? The transformation of the ISF, the wealth tax, was Emmanuel Macron's campaign promise, the one that earned him the label of president of the rich. Because obviously, it’s a nice tax gift for the 100 richest French people. This is a saving of 1.6 million euros, which is obviously a significant sum. The objective of the reform? That the money does not remain in the pockets of the most fortunate, but that it be invested in businesses. So, has it trickled into our economy? We tried to find out what the “first in line” had done with this tax gift. We tried to question them, meet those who manage their assets. They do not have to reinvest in the productive economy, on the other hand, they have consumed, yes. they consumed massively. I've definitely seen people who stopped being stingy. And have the great fortunes, who left abroad, returned to France? We question around 700 people each year, I haven't met anyone, in fact, who has returned to France. But then what was the point of this ISF reform, which could cost public finances more than 14 billion euros by 2020? We asked the question to the Minister of Public Accounts. We don't lower taxes for the sake of lowering taxes. We lower taxes because it boosts consumption. There is a tax system which cost the state coffers much more. This is the CICE, the Competitiveness and Employment Tax Credit. 100 billion euros since 2013. Twice the national education budget. This measure was the idea of ​​François Hollande. A measure was needed that was aimed at businesses. The former president wanted to boost the economy. But in the end, how many jobs were created? We will reveal to you the latest assessment of the CICE and we will also tell you how the system was financed. Do you remember the carbon tax? The one that ignited the problem and that you pay for when you go to the pump. Well, it was designed to finance the CICE and not ecology. In history, ecology was... was only instrumentalized. The CICE has just been abolished. But there is a system that resists all political changes, which has become a sort of tax sanctuary. This is the Research Tax Credit. Supposed to boost private research, the CIR is protected by all governments. The Research Tax Credit will be made permanent. There is no question of us changing it. No question of touching the CIR. When a parliamentary report criticizes it, it goes through the crusher. In fact, the report is as if it hadn't existed, that's quite astonishing. This report which was crushed, we recovered a copy. Come on, follow us to the tax kitchens. We're going to tell you about the tax revenues of our presidents. We promise you, it’s tasty. Although sometimes a little bitter. Our investigation begins in a popular town east of Paris. In Créteil. We invite ourselves to the MJC, the Youth Center. Between the Harmonica workshop and the Aikido class. We are going to participate in one of the 10,000 major debates on taxation, organized throughout France. Income tax must be differentiated according to the territories. Like at family dinners, we argue. If there is no sanction... Are we cutting each other off? We complain a lot. Taxes ? Fuck, go ahead, piss off, we pay too much tax. Of course, we are talking about income tax. But also corporate taxation, carbon taxes. And above all, Emmanuel Macron's reform. The ISF, the solidarity tax on wealth. When we ask the participants' opinions, no one agrees. Oh no, I won't bother you anymore, it's okay. No, but I'm going to bother sir. When you heard this measure that was announced, elimination of the ISF, what did you think? Oh well, I said to myself, it's a gift from Macron to the richest, it's a gift from a banker. That's what I told myself. It's a signal to say, listen guys, I did something for you. Yachts, go ahead, let go. Sports cars are good. The abolition of the ISF is something that will... Which has a good chance of relaunching investments in the country. So you believe it? I don't believe in it at all because large private companies... are constantly relocating their profits to tax havens. I find that this would be an extremely interesting and promising sign of reestablishing the ISF. We must restore the ISF. No. Because we can't do ping-pong, ping-pong, ping-pong. It doesn't sound serious. Ah well that’s for sure, the lady is right. The ISF is the longest ping-pong game in history. The exchange began in 1980. In the service, François Mitterrand. He will launch the IGF, the tax on large fortunes. But in 1986, in full cohabitation, his prime minister Jacques Chirac removed him. Three years later, with Michel Rocard, the left relaunched the game and created the famous ISF, the Wealth Solidarity Tax. 2007, very nice cushioning from Nicolas Sarkozy which reduces this tax. In 2012, François Hollande attempted an incredible move to increase the ISF to an unprecedented level. But it failed. The Constitutional Council rejects the point. In 2017, a new kid is relaunching the match. Come on, let's dive back into the last presidential campaign. At the time, candidate Emmanuel Macron promised to reform the ISF, the Solidarity Tax on Fortune. I proposed to eliminate the entire part of the ISF which concerns the taxation of investment, enrichment in a company, cash, etc. to keep the real estate part without changing the current rules in any way. Because real estate is personal choices, we do not finance the economy with real estate. Did you get the idea? To be clearer, we will explain to you what Emmanuel Macron has in mind. Come on, dream a little. Imagine that you have assets greater than 1.3 million euros. Until then, you had to declare the value of this heritage for taxes. First, your real estate. Houses, apartments, land... It's money that's sleeping! You also had to declare money that is not sleeping, your financial assets, such as your current account, your stocks or your life insurance. With Emmanuel Macron, financial assets leave the ISF. Suddenly, the ISF becomes the IFI, a simple Real Estate Wealth Tax. It's certain that the champagne corks must have popped among the richest people. Because this reform is a great tax saving. Well, the idea is not that they take advantage of it to do crazy things. No. This is because they invest their money in businesses. To revive the economy. In order to encourage them to invest more, Emmanuel Macron implemented another tax reform. You've heard less about it, that's normal. He mainly mentioned it in small groups. The rules of the game are very simple. You have before you a wonderful assembly of business leaders. It was during the election campaign. That day, the candidate is invited to a debate with SME bosses. In my project, I am carrying out a reform of capital taxation. And to make things simpler, I propose a “flat tax” at 30% social inclusive on the taxation of all capital flows. The what? The “flat tax”? Do you find it simpler ? Well, at first, we didn't understand anything either . We'll explain it to you. Emmanuel Macron wants to tax financial income less, that is to say dividends, interest on investments or even capital gains. Before, this income was taxed for the richest up to 58%. Now it's 30%. The same rate for everyone. That's another big drop. This tax will be called PFU, Single Flat-rate Deduction. For our society to get better, we need successful people. And you shouldn't be jealous of them. I must say it’s fantastic. And then, we even have to support them. Thanks to these two tax measures, Emmanuel Macron helps the “first in line”. I believe in ropes. There are successful women and men in society. If we start throwing stones at the leaders of the rope, the whole rope will tumble. And to avoid the collapse of the whole group, the president therefore relies on the richest and decides to trust them. Trust. Trust. Trust. Was Emmanuel Macron right to trust the richest? Have they reinvested their money in the economy? To find out, we decided to meet them. It was complicated. By telephone we contacted several French bosses. Here's what they answered: But why? By email, it was not more convincing. So, we are going to invite ourselves to a big meeting where we are sure to find them. This weekend, big bosses are invited to a seminar on the theme “Reconnecting with trust” That’s good, right? There are good people there, leaders of the CAC 40 and even the boss of MEDEF, Geoffroy Roux de Bézieux. In Aix-en-Provence, we head off to university. On campus, start-up atmosphere. Students, economists, entrepreneurs came to exchange, discuss and above all reconnect with trust. The room is packed. We still managed to find a small place. At the podium, CEOs like that of Carrefour. But also the first of them, the boss of MEDEF. In France, 78% of French people have the impression of living in an unequal society, while this is simply the case for 57% of Americans. We will try to approach them. A priori, it's not going to be simple. Stroke of luck. They let us pass. Big bosses don't joke about tax secrecy. Come on, last try. Sorry, we have to make our way. We would like to speak to the gentleman with glasses. He's the CEO of Air Liquide, one of the biggest companies in the CAC 40. Well, I mean, not very chatty among the front runners. It is not known what they did with their tax savings, nor how much money they gained from the IFI or PFU reforms. To get more precise answers, we have to go to the heart of power, in the Senate. Meet the president of the Finance Committee, PS senator Vincent Éblé. To him, Bercy cannot refuse anything, nor oppose the famous tax secrecy. He therefore asked what the impact of Emmanuel Macron's reforms was for the richest French people. Whether it is the IFI, the Real Estate Wealth Tax, but also the PFU, the Single Flat-rate Direct Debit. Here's what he got. A confidential note of around twenty pages. So in this document, did Bercy give you precise figures on the impact of the reforms? Yes of course, for example it is very interesting to see that the combination of these two important tax reforms of the year 2018 produced for the wealthiest French taxpayers an individual saving over the year of 1.6 million 'euros. Which obviously is a significant amount. 1.6 million euros in tax savings for the 100 richest French people. Yes that's it. It's a nice sum. We cannot say the opposite. I can take a little look. So it's difficult because we are also required to strictly control tax secrecy and statistical secrecy. So this information, if we can obtain it, we cannot communicate it to the press or to anyone. They remain secret. But there, precisely, you made it public to me, this figure. So... Yes, but the whole document, the page concerned, do you really want to see it? She is here. The senator doesn't give up. Look at the hand sign from his parliamentary attaché. Discreet but effective. At least take it in your hands. It's always a no from the parliamentary attaché. We will therefore retain this figure. 160 million euros in tax savings for the 100 biggest French fortunes. Or on average 1.6 million euros per taxpayer. Just that. The figures are intriguing. And as they come from Bercy, we wanted to submit them to the one who has the upper hand over state funds. Gérald Darmanin. Is the sound good? The Minister of Action and Public Accounts. Gérald Darmanin, thank you for welcoming us here to the ministry in Bercy. You made two emblematic tax reforms at the start of the five-year term, the transformation of the ISF into an IFI and the establishment of the PFU, the Single Flat-rate Levy at 30% for financial income. Why did you make this choice? We are choosing to eliminate social security contributions, in a very important way, we are giving purchasing power back to our fellow citizens, we are choosing to eliminate the housing tax, we are giving purchasing power back to our fellow citizens, And we remove part of the taxation of capital, not all, a part, which is the transformation of the ISF into IFI, and which is effectively the PFU, because we want to walk on our two legs, at the both give purchasing power to our fellow citizens, but at the same time revive the economy, by remunerating the risk better than the annuity. But I would like to talk to you about the chairman of the Senate Finance Committee, Vincent Éblé , whom you obviously know very well. He made a small calculation based on Bercy's figures for the year 2018, concerning your reforms of the IFI and the PFU. And for him, it's very clear, it's 160 million euros less in taxes to pay for the 100 largest French fortunes. So that’s 1.6 million euros in savings on average for each tax household concerned. Do you really think that these 100 biggest French fortunes needed these tax savings? It is with reasoning like that of the President of the Senate Finance Committee, with whom I work correctly. There is a very socialist reasoning. That we are a country with both a lot of unemployment... little growth and which has been stalled at the European and global level. But that's factual, What he says is economical. There are two subjects for me, ma'am. It's not ideological. Either we consider that the rich must be poorer, or we consider that the poor must be richer. And I have considered since I have been in politics that the poor must be richer. And I would say looking at things, has unemployment fallen over the last two years? But here it is the rich who are much richer all the same. Forgive me because 1.6 million euros in savings on average for each tax household, when it comes to the 100 richest people in France, we say to ourselves, they don't necessarily need it. I say it all the more since I don't pay wealth tax, I'm not at all conflicted in this story. You are budget minister, so this concerns you. But what interests me is not tax ideology. You say, it's ideology, it's fact. But fortunately there are rich people who put money into the French economy. Whether they put money into the French economy remains to be seen, we'll talk about it again. This is my belief. But I will answer you, if you allow me, when I tell you that there are 100,000 French people who earn more than 270,000 euros per year, or who have more than 3 million assets, they are tax controlled all the time. All the time. But you don't answer my question. But yes, I answer you that at the same time, I think that people who have money must invest it in the economy. So it's normal to pay less taxes. It's not normal to pay no taxes at all. They pay taxes, obviously. And moreover, they are always more controlled than the average French person, of course. And they still pay a lot more taxes. obviously than the average French person. So, I would like us to look at a graph that is very interesting, which is the latest report from the Public Policy Institute, which has just been released. This is the impact of your tax measures on household budgets. On the left, that is to say here, the poorest, and on the right, that is to say here, this long blue line which is here, the richest. For the poorest 7%, there are almost no gains, and even losses in purchasing power. The French who are really winners after your tax reforms are the... 0.1% who are the richest, look, it's the blue line which is furthest to the right here and which goes very high, it's a gain of 23,000 euros per year. And that concerns 0.1% of taxpayers, that concerns 30,000 households. So fortunately it's not April 1st for your show because I would have told you frankly that you played a good joke on me there. This graph is not a joke. It is very recent and comes from the IPP, the Institute of Public Policy. The Institute assessed the impact of all tax measures put in place by the government on household income. In 2020, according to their forecasts, the poorest 1% will lose 49 cents. The middle class will benefit from a gain of up to 1,303 euros. The richest 0.1% will earn 23,072 euros. First of all, these figures first of all, if you notice, they are of course, as you said, the figures of the PLF. It's the Public Policy Institute. You think the Public Policy Institute is making jokes? In any case, your graph, in this case... Ah, it's not a joke... It's quite funny. It's a Belgian joke. Tax policy. Public Policy Institute. It's like we're mixing cucumbers and turnips and carrots, and I'm really telling you, there's a lot of carrots. Not at all, these are all French households that pay taxes. Or not for that matter. All French people pay taxes. The first tax we pay is the contribution. Yes finally, income tax, forgive me. Oh no but wait, but it's nothing? 75 billion euros is income tax. What I'm waiting for is a comment on this graph. I'm telling you it's a joke. You don't like this chart. But yes, but I love him. However, it is factual. No, it demonstrates, I believe, a certain ideology which shows that we understand why we got to this point. Why have we managed to scare away people who wanted to put money into businesses and create wealth and reduce unemployment? We can both reduce unemployment and lower taxes. It's still a demonstration. of the ability of the President of the Republic to transform things and lower taxes, as they have never been lowered for the working and middle classes. This is the case for housing tax. 22 billion euros, I know you don't really want to talk about it. No, since earlier, you don't really want to talk about it. This is the biggest tax cut that has been made since the French Revolution. Before continuing to talk about revolution, finally fiscal revolution with you, Mr. Minister, we will leave you for a moment. To evoke a campaign promise from candidate Emmanuel Macron: Bring the rich back to France. Has the wealth tax reform made tax exiles want to return? Every summer, the best-selling issue of the year of Challenge magazine is released. The 500 greatest French fortunes. What interests us is not who are the richest, but have they packed their bags to return to the country? And Éric Tréguier knows this perfectly. For 24 years, he has been the one to produce this ranking. To validate his evaluations, he sends this questionnaire to the biggest fortunes. Well, there is a little administrative side to all this, which is that each time, we have to keep records. Let's take a closer look at this ranking. These 500 biggest French fortunes, you tell yourself that they necessarily live in France. Well no! Let's take the first 50 for example. 14 live abroad and pay their taxes in Switzerland, Great Britain and even Hawaii. Thanks to journalists, we were able to draw up a table of the tax residences of the richest and compare changes of address since Emmanuel Macron's reforms. Between last year and this year, have any of your great fortunes returned to France? So, I can assure you that we interview around 700 people each year, I have not met anyone, in fact, who has returned to France. Zero, And it's true that when we're settled somewhere, when we've been, for example, to Belgium, Brussels, his base with his family, we bought a house, and I know many who have relaunched businesses there, most of them have no desire to return. And it makes perfect sense. For what ? Because they are good. And then... Yet this is precisely what Emmanuel Macron was banking on when carrying out his tax reform. Yes, well yes, but we are perhaps starting from the wrong premise. Because you imagine that all the rich people are there crying, I no longer have the view of the Eiffel Tower, I absolutely want to go back No. People say very well, French taxation is back more or less on track for us, and so perhaps that will dry up the flow of those who are leaving. On the other hand, why come back to France, since we are now based elsewhere? It's not hard to be outside of France. For fishing for big money, it's a failure. But does it bite a little more with the smaller ones? In the chic-chic-chic neighborhoods of Paris, we will meet someone who knows them very, very well. He knows their name, He knows their address, and he even shares their privacy, well, their fiscal privacy. That's normal, it's their tax lawyer. It's already 6am, so... I just wanted to take a look at all your trophies. Ah my trophies! What are all these trophies? Marc Bornhauser is proud of these trophies . I hope to get a gold trophy... What do you need to have... You just have to be the best. The areas where he tries to be the best are clearly displayed on his site. Tax regularization and tax optimization. We at Cash know these subjects well. But he, obviously, Cash... Doesn't know. So, it seems, so your show, I looked into it a little, it's a bit... Sometimes it's a bit harsh... It's true that the show, it was a bit known, because she was the first one to talk about, you know, the Panama Papers. Ah yes, the Panama Papers brought us some clients who came to see us. I received a letter from the tax authorities! In the end, it wasn't bad for you, Cash Investigation. It's not bad, yes. Above all, it allowed me to see that the Swiss family company was in the Panama Papers. Ah good ? I said to my father, what the hell? He told me, yeah, it was at the time, we had done some great operations. Anyway, it was Swiss taxes that were evaded. Ah, well if it’s Swiss taxes! Alright. So when he came to power, Emmanuel Macron profoundly reformed the ISF. So did this bring in your customers? I have some who have come back, indeed. Those in a hurry returned almost immediately. The problem is that the Yellow Vest movement has clearly cooled people's enthusiasm. And now those who wanted to return are waiting. And we are struggling like hell to convince those who wanted to come back that we still have to come back and those who wanted to leave that the grass is not greener elsewhere. And so, how many people did you help bring back to France? So, there are threshold effects. At first, it's small streams and it turns into a big river. There, unfortunately, the movement stopped. We were still at the creek stage, so we brought a few people back. When you say a few people, how many is that? Can we encrypt? So, for me, if I talk about my office, we will talk about less than ten people. But I spoke with my colleagues, who do the same thing as me, who also noticed exactly the same movement. And then a stop since the beginning of the year. I believe that what really changed the opinion of these people was political concerns about the situation of the Yellow Vests. I can't be more specific. Really, it makes people cold. So it would be the fault of the Yellow Vests if the richest do not return? It should be noted, however, that in 2017, fewer of the rich left France than in previous years. This is the lowest number of departures since 2005. And precisely, those who did not leave, was Emmanuel Macron right to trust them? Do you, among your clients, know where they invested the money they saved by paying less taxes? They didn't fund the startups. In this sense, they have not reinvested in the productive economy. On the other hand, they consumed. They changed cars, they went on vacation, they did work that had been postponed for years. Finally, they consumed, yes, they consumed massively. I've definitely seen people who stopped being stingy. But to stop being stingy, wasn’t that Emmanuel Macron’s idea? The condition for no longer being in the ISF is to invest in the French economy. But if you decide to increase the number of villas, to buy luxury cars, we ask you for a little solidarity. We must count on their good will. I believe in this. The president believes in the goodwill of the richest. For sure. They will reinvest in businesses the tax savings they have benefited from. Except that for the moment, the reform of the wealth tax is above all a big tax loss for the State accounts. It is even the Ministry of the Economy which recognizes this in this document. The 2020 finance bill. Here are the billions of euros lost by the replacement of the ISF, in real estate wealth tax in 2018, 2019, 2020. And here is the shortfall for the implementation of the Flat-rate Levy Unique, the PFU. If we add up these three years, it is therefore a total of 14.5 billion euros less in the state coffers. However, during the campaign, Emmanuel Macron promised us that it would cost nothing, zero euros. You don't believe us? We immersed ourselves in the candidate's electoral program. We went to look on the En Marche website. Good thing he's still online. In the Taxation section, here is what is written for the ISF. The ISF represents a shortfall for the State of 2 billion euros. It will be financed by revenue from the new Flat-rate Levy, PFU. In total, the reform of capital taxation will be carried out at zero cost. How could the campaign team have made such a mistake? We are not talking about the capital L for zero, no, but about the promise of a zero-cost reform, while Bercy forecasts a hole of 14.5 billion euros in the state coffers over three years. We analyzed confidential documents. Emails exchanged by members of the campaign team who worked on the tax program of candidate Emmanuel Macron. These emails are MacronLeaks. Emails made public by hackers during the presidential election. These exchanges, which should have remained secret, will enlighten us on Emmanuel Macron's campaign promises. It all started at Bercy in 2016. That day, Emmanuel Macron lived his last hours as Minister of the Economy. He delivers a vibrant farewell speech. Bercy is a wonderful island. I was very proud to be there with you. It is one of the essential islands of the archipelago that forms the State. But I had to take to the sea in a decidedly more frail boat, but with a course and a willingness to take this risk. Except that in real life, Emmanuel Macron does not set sail alone. In his crew, he includes his second in command, his former chief of staff and his advisors who worked with him at the ministry. At the dock, he has another unofficial team which remains on Bercy Island. Senior state officials who will work in the shadows for the candidate. Throughout the presidential campaign, the En Marche team and the Bercy team will send each other messages and emails day and night. These emails, in fact, are the ones that we recovered. You will understand how the campaign team developed its zero-cost tax program. The civil servants remaining at Bercy are working on the candidate's two major tax reforms. The IFI, the Real Estate Wealth Tax, and the PFU, the Single Flat-rate Levy. The objective to achieve, this famous zero cost. For this to work, there are conditions. Here is what senior officials at Bercy wrote in a memo in 2016. Do you understand? To finance this tax reform, the Bercy team proposes to tax more the savings of the French, such as the Livret A and life insurance. The problem is that these investments are very popular. So at campaign HQ, things are stuck. In the team, one of those closest to Emmanuel Macron writes: Yes, difficult to sell in an electoral campaign. So we don't touch the savings of the French . So, zero-cost reform doesn’t work. This is what an internal memo reveals. There is a shortage of 2 to 3 billion euros per year. Conclusion, it doesn't work. Be careful, did I tell you it wouldn't work? I told you ? However, what the campaign team is going to sell us is a zero-cost reform. How could they make a promise that they knew was untenable? We contacted two economists who participated in the development of the president's program. In Emmanuel Macron's program, it was announced that the reform of capital taxation would be carried out in vain. Why was this reform announced like that? In Aix-en-Provence, at the big meeting to restore confidence, another economist agreed to meet us. I will immediately hand the floor over to Philippe Aghion. And not just anyone, one of the inspirations of candidate Macron's program. What allows us to still believe in the future? Philippe Aghion is the man who advised the future president to implement the famous PFU, the 30% rate for financial income. There is an important reform which was decided during the campaign and implemented since, it is the PFU, the Single Flat-rate Levy. Yes, I pushed a lot for that. Yourself ? Were you in favor? I myself was supportive. So at the time, there were certain members of the campaign team who said, this PFU must be put in place, but we will eliminate certain tax loopholes. That's what I said myself, that at the same time as we moved to the flat tax, well, we flatten the tax loopholes to see which ones we keep , the ones we don't keep. I'm not saying we should remove them, but there are a whole series of niches that need to be re-examined. But at the time, it wasn't accepted, why? I don't know. But in any case, it was worth looking into. And what does he think of the promise of zero-cost reform? It was announced that this would be a zero-cost reform. It was not announced that we were going to lose money. Yes, what I often say is that you have to know how to lose money to earn it, and you have to know how to lose time to earn it. But at the same time, this program also announced that it was zero cost. Yes, okay, he announced it. But there you go, but in the spirit, perhaps to the letter... You know, there is the spirit and the letter. And there you have it, I think that in spirit, it was the good idea all the same. Trust the richest. Less taxed, they would invest in businesses and that would be good for the country. But for the OFCE economist, Pierre Madec, banking on confidence is not worth much. They consider that... The PFU or the establishment of the IFI will profoundly transform the investment choices of households. But this has not been proven by any study. We are making a bet which is that they will reinvest the billions, which we will not take from them under the ISF, they will reinvest it in the economy. That's a gamble that we take because, on the other hand, there is no guarantee that these investments will be made. However, when we evaluate public policy and in particular budgetary costs, we normally do not take behavior into account, because that forces you to make a whole bunch of hypotheses which potentially will be swept away very quickly by the reality of the facts. To verify the reality of the facts, the government is committed to evaluating its tax reform in 2017. But the Yellow Vest revolt and criticism of the president from the rich will push Emmanuel Macron to make an announcement. It was during a press conference at the Elysée last spring. I consider it my duty to defend this part of the reform . It comes down to simple pragmatism. But as it is a pragmatic reform, it will be evaluated in 2020, and we will look at its effectiveness. If it is not effective, we will correct it. The President of the Republic promises to correct the reform if it is ineffective. But are we really able to evaluate it? France Stratégie is responsible for this evaluation. A public body attached to Matignon, which will rely on a committee specially created by the government. Even for the 15 members of the committee, evaluating tax reforms is not that simple. This is what one of them will tell us, but anonymously, because they are prohibited from commenting on the current evaluation. Is it a woman? No. Does he have a beard? Sorry, we won't tell you more. He agreed to meet us, but does not wish to appear. So we reconstructed the interview. This is his testimony, word for word. We won't really be able to say much. Maybe we can see that people have decided to sell I don't know what, sell real estate to buy stocks. That doesn't mean that it will have an effect on the French economy, you see. Will it really have created jobs? If you buy stocks, will it change the face of the world? There is little chance. It won't be easy to show anything. Moreover, at the beginning of October, the committee issued a first report which concluded Before knowing whether or not the government was right to trust the richest, we will have to be patient. In the meantime, let's go back to see the Minister of Action and Public Accounts. France Stratégique, the prime minister charged with evaluating the reform, has just published its first report. And this is what they write, it's here. “We will have to wait until 2021 to be able to carry out a detailed analysis of the evolution of capital income.” So we will have to wait two more years. We say to ourselves that it's a bit long anyway. In 2021, the real evaluation is the presidential election. We'll see, didn't the president say that he lowered unemployment or not? Well, today we have created 500,000 jobs in 2 years... I'm talking to you about the evaluation, not about unemployment, here I'm talking to you about the evaluation of the transformation of the ISF into IFI and PFU. I don't believe that the rooster crows in the morning when the sun rises. I think there is a link between what we do and what we obtain. If we have created 500,000 jobs over the past 2 years, it is perhaps also because we have not been fiscal ideologues and that we have eliminated a tax which was against employment. And what's more, we created... Why a tax against employment? Because in an open world, when you have both Belgium and France, when when you earn money, you are taxed more in one place rather than another, you tend, it's quite human , to go to the side where we pay less taxes than where we pay more. So you are convinced that in fact, by transforming the ISF into an IFI and a PFU, you will bring back jobs? Basically, investors will come back, right? That big fortunes will reinvest in France? It's not a belief, it's a fact. It is a fact that France is one of the 5 countries in the world where foreign investors now come to invest. And it is a fact that unemployment has been falling continuously since the election of the President of the Republic. 500,000 jobs created over the past 2 years. It is certain that the taxation put in place by the President of the Republic has contributed to the reduction in unemployment. So let's come back to the reform of the USF. The criticism that was made to the President of the Republic, in this case Emmanuel Macron, and to the government, is for having trusted the richest. Why didn't you put... conditions so that these big fortunes really invest in the French economy, particularly in French companies? Why were there no conditions set? I believe that the question deserves to be evaluated. And what could he possibly do tomorrow, I say perhaps tomorrow, because it's really too early to draw conclusions, to say to ourselves we were right and Mr. President of the Republic had the courage to remove an idiotic tax but we can clearly see that there is extremely strong ideological resistance, which favored unemployment, but perhaps we could go further to be sure that we are a good guarantor, that things are going well in the economy French. Do you have doubts ? It's normal, doubt is part of life. Of course, it's even pretty good to recognize this in politics. I think this is a question that arises in everything. A priori, like everyone else, I tend to trust economic players. Is trust enough? Trust still creates a relationship. it creates family,... You move away, Mr. Darmanin! It creates the nation, it creates work relations. No, but you can't start by saying we're going to put locks everywhere. So between few constraints and a lot of constraints, there is perhaps a happy medium that has not been found, that's what you are saying. I say that this is part of the evaluation proposed by the President of the Republic. The objective of your reform was also to bring back to France the greatest fortunes who had fled the country, we agree on that. This was very clearly established and affirmed by the President of the Republic. So I'm going to give you two figures which are confidential, but I'm happy to give them to you. In 2014, there were 900 departures of taxpayers who went abroad, and there we were around 300 in the year 2017. So it's interesting because we're looking at, indeed, there were fewer departures. We see that it is decreasing. Yes yes. Notably the year 2017 here. If it goes down, I think there was a presidential election. But I'm talking to you about departures. Here I'm talking to you about, has there been any feedback? And then we say to ourselves, well no actually... There very clearly... Forgive me, I'm just getting to the end of my question. But really, at the end of this question, that is to say that one of your objectives was the return of great fortunes. We see this graph and we say to ourselves, well no, the return of the great fortunes... You will have noticed, because that is very interesting, so in 2017, we can clearly see that there was a reduction by two, nothing than in the presidential year. What will be interesting is to know 2018, 2019, 2020, because we will have completely abolished the wealth tax , particularly from 2019 . What I know is the people who have returned, that when you see... When you probably question me in the coming months if you wish, there will be an increase in returns. But do you have any figures? We have more than doubled the income from the real estate wealth tax. And so we have a lot more taxpayers and these are people who have come back. In any case, we know that these reforms led to a hole in the state budget. Look, that’s the PLF, the Finance Bill. For the ISF, it is less 3.2 billion euros per year. In total, if we look at the 2020 finance bill, it is 14.5 billion euros less over three years. We say to ourselves that this is therefore a reform that is costly to public accounts and therefore to taxpayers. You are right about the IFI. On the IFI, it's roughly that, between 3 and 3.5 billion euros. So your figures, that is to say those of the PLF, are obviously the correct ones. A little over 10 billion on capital, a little over 10 billion less in taxes on the company. a little more than 30 billion less on households. Okay, so there is no regret about the fact that the abolition of the ISF and the transformation into IFI and PFU deprive you, in quotes, of 14.5 billion euros? No because there are additional recipes. All right. What surprises me, quite frankly, is that during Emmanuel Macron's campaign, we said that this tax reform, the abolition of the ISF, was offered at zero cost. But there is money coming in. No, but at zero cost. But madam, in this case we are not at zero cost, minus 14.5 billion euros. No, but you can't understand, the President of the Republic is not totally stupid, we agree. When he makes an economic program and says that it is at zero cost, we clearly agree that there is less revenue, when we lower taxes, and more revenue. We don't lower taxes for the sake of lowering taxes, we lower taxes because it boosts consumption. When we lower the housing tax like no one has ever lowered it, 22 billion euros less in housing taxes. The French, at least those who earn less than 2,500 euros, see this if they listen to us. When we lower income tax, they will see it from January. And you see that by eliminating the capital tax, we manage to create 500,000 more jobs, I think we can say that it is a successful economic policy. A story based on trust. We have another one to tell you. And this time, we even have a little perspective to evaluate it. This story is that of the CICE. In the year 2012, anger is brewing in factories that are victims of globalization. The symbol of the crisis are the threats of closure of ArcelorMittal in Florange. But fortunately, President François Hollande had an idea to help businesses resist international competition. Make competitiveness and employment one and the same fight. It started like that. This is what I propose. So that the French know it well, it is a pact of trust. So that investment is preferred to the distribution of dividends. So that the job is done in France rather than elsewhere. And so that the wealth created... can be better distributed. A pact... It's give and take. Give and take. In six years, 100 billion euros have been given to businesses, twice the annual national education budget. This is what François Hollande had in mind at the time. François Hollande's goal is to create jobs. For this, it offers a tax credit to businesses. For each employee paid less than 3,000 euros gross per month, they can deduct 6% of the salary amount from their tax. Labor costs are falling, so companies are more competitive and should hire more. A priori, it is a virtuous circle. Among the biggest beneficiaries of the CICE, the SNCF, La Poste, Banque Populaire Caisse d’épargne, Veolia, Thalès. And then there is Carrefour. 755 million euros in tax credits since 2013. A hell of a sum. Logically, it is the leading private employer in France. But then how many employees Did Carrefour recruit thanks to the CICE? It had to be hiring all over the place. CVs here. Well, not really. Philippe Allard is bitter. This warehouse worker is a CGT union representative. He kept accounts of all the positions that disappeared in the group. For a year, there has been a massacre at Carrefour. They have eliminated 2,300 jobs via the voluntary departure plan concerning the headquarters, 1,500 jobs in the local area and in the indicated stores. That was for 2018. And in 2019, they are preparing to cut 3,000 jobs via collective contractual termination, which means almost 7,000 employees. It’s shameful what’s happening in France. Even more in creation, we are in the saving of jobs, and even in saving jobs, we have not succeeded. Philippe Allard takes us to a supermarket near Avignon. At Carrefour, as in all major retailers, the hypermarket model is in crisis. Here, we went from 177 employees to 145 in less than a year. The numbers will drop further in a few months. Around twenty employees are expected to sign a collective contractual termination. Come on, let's grab a cart and let's go for a visit with a discreet camera. Once in the store, Philippe Allard notices a first change. The high-tech section has almost disappeared. There was a whole section which was devoted precisely to Hi-Fi, to TV, to this whole universe, which was deleted with 4 positions eliminated. And now it comes down to... A pot of sorrow. But that's not all. Philippe Allard leads us to the cash registers. Before there were 24 physical checkouts, they have halved, there are only 12 left. And at the very back, there are 12 automatic checkouts. Here are the brand new automatic cash registers that have replaced the employees. From now on, you are the cashier . Ah but look, there's still a real person there. A cashier. On the one hand, positions eliminated, and on the other, investments to transform this hypermarket, such as automatic checkouts. Do you know here how much it cost to modernize this intersection? Yes, so the information we have from management is 1.2 million euros. Oh yes, hello. Philippe Allard will not have time to tell us more. Store security spotted us. To the police? Well, don't worry, we're not finished at the station. But we still had one last question. Would the automatic cash registers have been financed by the CICE? That would be a shame, right? Because with the CICE, companies have the right to finance almost anything they want. In short, everything is allowed. Oh yes, there are still two prohibitions. The CICE should not be used to increase dividends or executive remuneration. Do you think that the CICE helped finance the automatic cash registers? I think that in any case, even if there hadn't been the CICE, they would have installed automatic checkouts. Except that the CICE brought cash to the company to be able to achieve it. And do you have proof of that? But no, because everything is opaque at Carrefour. They give us documents where we cannot verify anything. We called in experts and they don't know. However, according to the law, the works council is informed and consulted each year on the use of this tax credit. Unions should therefore be aware. But François Hollande, when he was President of the Republic, he promised that by giving you the right to review the use of the CICE, it was a way of asking companies for compensation. He makes fun of us. François Hollande, I don't know if he was thinking at the time, but in any case, everyone made fun of us with the use of the CICE. Six years after the establishment of the CICE, Philippe Allard still does not know what the 755 million euros in tax credits paid to Carrefour were used for. So with the other unions, they will take advantage of a works council to ask again the annoying question about the CICE. We too asked Carrefour for more details on the use of the CICE. Their response is one email. Concerning the job cuts, the group explains to us that they were all covered by plans which were the subject of majority agreements with the union organizations. As for the use of the CICE, Carrefour writes that this tax credit is intended to invest, improve the competitiveness of businesses, preserve employment or conquer new markets. That's it that's all. No information on the allocation of the tax credit. But then who can verify all this if the unions and journalists cannot do it? Our elected officials, supposed to control public money? A parliamentarian tried to understand how the CICE is used. What does it allow to finance in the companies that benefit from it? But she had trouble finding information. Well, that’s a good joke! She’s the one, right? In Saint-Pierre-des-Corps, we will meet the mayor, Marie-France Beaufils, the former communist senator and the author of the report on the CICE. A mission that she had great difficulty carrying out, because the General Directorate of Taxes opposed tax secrecy. In your report, there is no specific company example. For what ? You saw that we went to the maximum of what we could say. We were able to give the trends that this allowed us to analyze, but we cannot say, for example, such and such a company has misused this resource. I cannot know the specific situation of a company. This is covered by what is called tax secrecy. But does that mean that you, even as an elected representative of the Republic, cannot have access to the tax data of a company which benefits from a tax credit, and therefore from public money? No, I don't have that option. It still seems incredible. This is one of the difficulties we encounter today when working on these issues. However, the CICE has become the tax niche that costs the State the most. If we look at Bercy's figures, the cost increased from 11.8 billion euros in 2013 to more than 20 billion in 2018. But the senator discovered that the tax authorities could not do much to control this public money. She got her hands on this note from July 2013 from the General Directorate of Taxes. Here is the instruction given to tax inspectors on monitoring the use of the tax credit. In tax language, this means that even if the CICE was used to finance dividends or the remuneration of bosses, the inspectors will not be able to turn around the company. In short, even if companies do not respect the law, the tax authorities turn a blind eye. It is unheard ! It's not acceptable, it's not admissible. And all this because... We considered that this could be an obstacle to the use of the CICE for companies which could benefit from it. Now, in some ways, since it is a tax credit, it is as if it were public funds. Has the CICE at least created jobs? This evaluation is the mission of France Stratégie. You know, the public body that measures the impact of reforms from different governments. France Stratégie asked two groups of economists to estimate the number of jobs created or saved between 2013 and 2015. Here is their conclusion. We decided to go and meet one of the teams who worked for France Stratégie. Beyond the low number of jobs created, this economics professor mainly discovered that the CICE had passed into salaries. But don't pay attention to the salaries of workers and employees. See, the curve is flat and even goes down slightly. But in executive salaries. There it is clearly increasing. And so we draw the conclusion that companies shared the benefit of the CICE with their most qualified employees. Did this result surprise you? The fact that this profit sharing is done with the employees who, in a certain way, have the most negotiating power, that is to say the most qualified employees, no, in view of what we known from economic theory, these results are not particularly surprising. So does this mean that the companies which received CICE favored increasing executive salaries rather than creating jobs? That's it. This study ended in 2015. Since then, what has happened? Have there been new job creations thanks to the CICE? France Stratégie has just commissioned a new study. But to another team of economists who work for the OFCE, the French Observatory of Economic Conditions. They examined the impact on companies that benefit from the CICE, but also the impact on the French economy. Because to finance his tax measure, François Hollande had to find money somewhere. The cost of the CICE, the economist Eric Heyer integrated it into his calculations. He discovered that since 2013, this tax credit has indeed created jobs, but it has also destroyed them. There is a favorable effect, it has made it possible to create around 260,000 jobs since the establishment of this CICE, that is to say since 2013. The problem is that this CICE had to be financed directly, and this financing means an increase in VAT, a reduction in public spending, and therefore overall a reduction in the purchasing power of households. And when you lower the purchasing power of households, they consume less, so there are fewer demands placed on businesses, so French businesses need fewer people. There, we estimate around 130,000 job losses linked to financing. So, 260,000 minus 130,000, we would be on the order of magnitude of 130,000 net job creations linked to this system. But at the time, it was not really said by the government that ultimately the financing of the CICE could as such destroy jobs in the long term. I think that the government had indeed minimized the effect of the financing, but we can also say that it had no other choice, since the alternative would have been that it let the deficits slip away, and that it does not finance it by households. He couldn't finance it through businesses, we couldn't make a gift for businesses on the one hand and take it back straight away. So they had to ask households to do it. Okay, let's sum it up. The CICE cost taxpayers 100 billion euros and would have created 130,000 jobs in 6 years. A lot of public money for a result that seems a little meager. The time has come to question the person who created it. What does François Hollande think of his measure? Does he have any regrets? How are you ? Good morning. We have a meeting with the former President of the Republic. It's been exactly six years since the CICE, the Competitiveness and Employment Tax Credit, was put in place. It was really the flagship measure of your start to your five-year term. What assessment do you draw from it today? In 2012, the French economy was in recession, in great difficulty. So a measure was needed that was aimed at businesses. So I invented a measure, the CICE, that is to say a tax provision which did not commit funds for the year 2013, but which could have an immediate effect for businesses. And then, it was sustained for 6 years, and we can take stock of it. So, what assessment do you make of this CICE 6 years later? I estimate approximately 300,000 jobs created and many businesses, particularly small ones. which would undoubtedly have disappeared and gone bankrupt if it had not been for the CICE. So you say 300,000 jobs created by the CICE in 6 years, it's surprising because you gave another figure to the Yellow Vests that you met, I think it was a year ago in Ardèche , the exchange was filmed, I suggest that we look together at what you said at that time to these Yellow Vests. I am the CICE, if I may try, We have done 700,000 in the last three years. 700,000! We created 700,000 jobs in the last three years of my five-year term. Oh no, but he was talking about the CICE, the Yellow Vest there, he asks you about the CICE. No, he is taking up a promise that had been made by Mr. Gattaz, you remember, on the million jobs. The million jobs... But he talks to you about the CICE, and you tell him: “We have created 700,000 jobs”. Yes, we created it! What is the right number? Is it 300,000? Is it 700,000? We created 700,000 jobs over the last three years of the five-year term. What relates to the effect of the CICE, what relates to other measures, what relates to the economic situation, it's... Not necessarily easy to evaluate, but the figure of 700,000 is indisputable. More recently, France Stratégie commissioned a new study, this time from economists from the OFCE, the French Observatory of Economic Conditions, and they affirm that these 130,000 jobs which were created between 2013 and 2018, we are far from the account. First, I dispute the figure of 130,000, which counts... Which is an economist's figure eh? But no, but it's not... The real number, the truth. This is not what economists will calculate, it is the number of jobs that have been created. There were 700,000 more. So are you still, today, satisfied with the results of the CICE, if we compare a figure of 100 billion euros which was spent, 20 billion euros per year, and a figure of 130,000 net jobs created. There were not 130,000 jobs created, there were 700,000. I'm only talking about the CICE. I'm talking to you about the 700,000. And in the 700,000... Why don't you just want to talk about the CICE? Because, in the 700,000, you have the CICE at a level undoubtedly much higher than what the OFCE says, and then you have other factors. How can you measure the effect of a measure in relation to the life of a company? That is to say, would a company without the CICE have continued to pursue its activity would have been... That is uncantifiable. Well it’s uncantifiable, yes. So I would now like to talk to you about CICE control. It was very important for you, you really had very clear positions on this. You did not want the reform to be diverted from its primary goal, that is to say the creation of jobs and the competitiveness of businesses. Are you sure that was the case? There would be possibilities of abuse. But if we fear abuse, we no longer do anything. When I create the CICE, it is based on the payroll, 6%. This is therefore identified in the company accounts. The unions can say what have you done with the CICE line? Companies can answer, I invested, I... Hired, I improved my competitiveness for export. So unions have the opportunity to monitor, evaluate and hold the company accountable. It's very interesting what you tell us, because we actually found ourselves interviewing trade unionists who ask for very precise accounts on the CICE, but they are unable to obtain them. I'll give you a very specific example. The Carrefour unions are wondering if the CICE was used to finance the automatic cash registers which have... In fact led to job losses or non-replacements of people who have retired. They ask for this information. First, they know the amount of the CICE. in business, this is very important. But absolutely not assignments. Wait, they didn't know that, they would never have known if it had been a reduction in social security contributions. They can say, what did you do with it? Exactly, that's what they're asking. It's part of social dialogue. What did you do with it? And they don't know it. And you can also tell the company, what did you do with it? And we have no answer, and the unions have no answer. So, it depends on the... on the strength of social dialogue, but we can still have a global answer, since we can look at what has been done in terms of investment, what is -what was done in terms of hiring, what was done in terms of salary. You included in the reform that CICE money should absolutely not be used to increase dividends or executive remuneration. However, we came across a note from the DGFIP, the General Directorate of Public Finances. And this note from the DGFIP basically says the opposite , so I admit that we were extremely surprised. The tax credit cannot be considered for the sole reason that it was used to increase the amount of profits distributed or the remuneration of the managers of the companies concerned. Yes, but that… It’s a Bercy service that publishes that. But it's not... It's completely transparent, that's known. But that's contradictory to what you're saying. No, what does the DGFIP say? She says that there cannot be, on the part of the State, because she speaks in the name of the State, this direction, we cannot take back the CICE under the pretext... which served them to increase profits. Okay, you're telling me, so the CICE money was distributed without any control and without any sanction? Yes, there are checks, no sanctions, that was planned. So we can have, a company can have CICE money, do with it what it wants, including increasing dividends, including increasing executive remuneration... Which they have not done. elsewhere in the vast majority, but there was no sanction. So that’s 100 billion euros of public money. therefore of taxpayers' money, and to say that there is no control and no sanctions is difficult to understand. But that there is no longer any control is not true. Very little. I tell you that control is done within the company, and no sanctions, that was the principle. Because at some point, it's called confidence. Don't you regret this trust today? But when we trust, we can be abused, it has happened. Not just in economics, one can be abused politically. And do you consider yourself to have been on the CICE? No, and some companies probably made use of it that was not what I would have liked. This was undoubtedly not what the economy expected from these companies. But essentially... Essentially , for the vast majority of businesses, especially small and medium-sized ones. The CICE was well used. And if we were able to have this return to growth, this improvement in our results, it is due to this policy. And this policy was based precisely on this contract of trust and on social dialogue. Sorry, Mr. President, we are going to interrupt the interview for a few moments. No, no, not because of Philae, your labrador, but for a riddle. And no, it's not a joke. How did the French partly finance your flagship measure? Come on, a hint. You pay it every time you go to the pump. It has caused the price of your fuel and the amount of your bill to skyrocket. You guessed ? The carbon tax! However, when it was decided in 2012, this tax went unnoticed. This story is told to us by MP Delphine Bateau. At the time, she was François Hollande's minister of ecology. She learned of the idea of ​​this tax during a phone call from Matignon. She quickly understands that the carbon tax has nothing to do with ecology. I learned it on a Sunday. I am in the car and in fact I am asked for my opinion on the fact of creating a carbon tax, therefore of creating ecological taxation to finance the CICE. In fact, I am not called for general arbitration, on the creation of a CICE, etc. They're calling me because to finance it, we're going to have to create ecological taxation. Finally, for you, the carbon tax was really seen as the instrument to finance the CICE? In fact, it is only a pretext in this matter. We could have, I don't know, call it, I don't know, the tax on windows, there would be a tax on windows which would have financed the CICE, that is to say that in history, ecology was only instrumentalized . And how do you react at that moment? I decide to open an internal government battle immediately, so I write. In the evening, a note to the Prime Minister and the President of the Republic. I say but you cannot do that, it is not possible to create ecological taxation for anything other than ecology. Sooner or later, the French will see this and revolt. The minister had a nose. But his warnings will not be heeded. Under François Hollande, the carbon tax was created to finance the CICE. This tax is largely paid by motorists. From 7 euros per tonne of CO2 in 2014, the tax must increase to reach 100 euros in 2030. In 2016, it already brings in 3.8 billion euros, of which 3 billion finances the CICE. Today, we should not be surprised that people actually say it is to pick our pockets and that is the truth, that is to say that the carbon tax Under these conditions, is the only ecological measure supported by Bercy. Bercy halves energy saving aid. Bercy is opposed to any progress in ecological economic policy, except the levy of an additional tax because in fact it is diverted from its purpose. It is to make households finance aid to businesses, it is a tax transfer in fact. It's true that an ecological tax paid by the French to finance a measure intended for businesses is surprising. Let's return to rue de Rivoli, to François Hollande's office. I would like us to talk about the financing of the measure, because that too is extremely interesting. To finance the CICE, you created a new tax that really resonates with the French, the carbon tax. This carbon tax was used to finance the CICE to the tune of 3 billion euros in 2016. An ecological tax to boost the competitiveness of businesses. Was this your idea? Because a priori it’s rather surprising. It's quite a good idea. It was a very strong idea which had been held for a long time by economists and especially by ecologists, which was to say that it is absolutely necessary that we increase the taxes which destroy nature and that we reduce the taxes which destroy work. But then understand that for motorists who paid part of the carbon tax and who found themselves, as taxpayers, paying more for their gasoline by paying the carbon tax, they say to themselves it's me who finances the competitiveness of businesses? The carbon tax must finance employment. Because that's what matters. Ensure that nature is respected as much as possible and work is encouraged as much as possible. We make sure to save nature and also promote employment. You understand that taxpayers, sir, madam, everyone who is going to fill up, they do not necessarily agree to pay for the competitiveness of businesses through the carbon tax. It's as if you were saying, is it really normal for the carbon tax to finance national education? Yes ! In a way, fortunately the taxes go into a general fund which finances general interest expenditures. Except that this is not for national education, it is for businesses. It's not for businesses, it's for employment, Do not confuse. It is still for the competitiveness of businesses. And if there is no competitiveness, is there employment? So, your Minister of Ecology at the time, Delphine Batho, said she was faced with the fait accompli, in fact, of seeing an ecological tax to finance the CICE. We're going to listen together to what she said, and I'm obviously going to ask you for your reaction. In history... Ecology was only instrumentalized. What do you say to Delphine Batho who says that you have exploited ecology? I answer him, for the first time, ecological taxation was created in France. And secondly, the fact that we allocated this ecological tax to job creation, which was the first priority of my five-year term, was logical. We could have affected her... Not for her anyway. I'm telling you about myself. We could have assigned it to measurements. for the environment. This is a completely legitimate debate. But spending on the environment has also increased, public spending on the environment has also increased during my five-year term. Because logically, we say to ourselves that when we create an ecological tax, it is for the environment, it is not for competitiveness. But if I had reduced public spending on the environment, this criticism would be entirely relevant. But once we increased what we had to do for the environment, within the budgetary framework, the carbon contribution, in a certain way, also went to the state budget. Well, thank you, Mr. President. Thank you so much. See you soon. THANKS. Thank you. François Hollande tried to convince us that his CICE story was beautiful. But there is one who was not convinced at all. It is his successor, Emmanuel Macron. He decides to delete it. From the start of his campaign in 2016, his team focused on the CICE. This is what other confidential emails reveal to us. In this fact sheet written by a member of the Bercy team, the effects of the CICE on the economy are judged to fall short of expectations. He proposes replacing the CICE with a reduction in business charges. But it will cost the state dearly. Because Emmanuel Macron chooses to combine the old and new measures for one year. In 2019, the problem is that there is a double cost. That is to say, since it is a tax credit, in 2019, we pay what we owe in the name of 2018. And, since it is now a reduction in contributions, we owe everything following this transformation. And therefore, for public finances, it is a cost of 20 billion additional. Total cost, 40 billion euros. It's twice as expensive for a year. To finance this brutal transition, the campaign team has a solution. But yes, you guessed it, ecological taxation. Only, one member of the team is worried. The campaign team does not listen to this alert . One of the members will even advocate aligning the price of diesel with that of gasoline. Not an easy sell as a measure, but he has already found a good scenario. As soon as it came to power, the government announced the alignment of the price of diesel with gasoline within 5 years. But above all, it increases the carbon tax. Let's take a look at the trajectory of the tax planned under François Hollande. You remember, the one which goes from 7 to 100 euros per tonne of CO2 in 2030. Under the presidency of Emmanuel Macron, the same tax rises higher, faster, for the same objective. From 2018, the tax increases from 39 euros to more than 44 euros per ton of CO2. More than 5 euros difference which will be reflected in prices at the pump and cause the crisis that we know about. Since then, the carbon tax increase has been suspended. However, it is on it that the government was partly counting to finance the double cost of the CICE. To finance this transformation of the CICE into reduced contributions, like François Hollande, you have increased ecological taxation, in particular with an increase in the carbon tax. Why this choice ? Everyone agreed to increase ecological taxation in the presidential campaign. And ecological taxation, like that, seems nice. And then, as soon as we see that the price of diesel or gasoline is increasing, it's less pleasant because it's much more concrete and there are plenty of people who have to take their cars to to go to work. So that's... I think it was an error to think that the French... whatever the place on the national territory, either did not need their vehicle, or could understand this desired ecological transformation . We had important debates, it seems to me, and the Yellow Vest crisis put an end to the increase in this carbon tax. Yes, you have put an end to the increase in the carbon tax. The carbon tax still exists. At the time, you even decided to increase the carbon tax even more sharply than the previous government. In 2008, the carbon tax was to rise to 39 euros per tonne of CO2. You decide to increase it to 44.60 euros. So, I think it's on this document, we're going to look at it together. Is it a regret? That is to say, what do you say, a posteriori, this increase in the carbon tax that we decided?... It is clearly, indeed, not acceptable for the French, I think that they have it... They showed it. I have to go to Parliament. Thank you, Mr. Darmanin. Thank you so much. Too bad time flies so quickly. There is a tax system that we would have liked to talk to you about, Mr. Minister. It costs the state coffers billions of euros each year and resists all political changes. In the temple of taxation, there is a well-guarded treasure. Whether you are an aeronautics giant, an automobile manufacturer, a pharmaceutical industry juggernaut or a new technology company, it is a talisman believed to bring prosperity, employment and innovation. We call it the Research Tax Credit, the CIR for short. This relic has a gift. She has been through all the zones of political turbulence for 36 years. Every government pledges allegiance to it and anyone who reforms it will be cursed. We will keep the Research Tax Credit, which is the most attractive tax system in the world . There is no question of us changing it. The Research Tax Credit will be perpetuated in its current form. The Research Tax Credit is a pillar of our innovation policy. There is therefore no question of calling it into question. Don't touch the CIR. According to our political leaders, this would be a great way to boost research and development. R&D for insiders. Let's take a company. It invests in research by hiring researchers and purchasing equipment. Up to 100 million euros of investment, it can deduct 30% of this sum from its taxes. A great tax saving and above all a good way to achieve tax optimization. This is in any case the opinion of Patrick Lemaire, research director at the CNRS. He is also a member of the “Science en marche” collective , an association whose mission is to defend the jobs of researchers and which therefore examined the CIR under the microscope. What is the main criticism that you would make today about this Research Tax Credit? That it doesn't work. It does not work ? It doesn't work for businesses. If it worked, we would see that companies invest more and more in research. We would see that France is gradually meeting its international targets which are to have 3% of GDP invested in research. We are at 2.25. Unlike Germany, Scandinavia, Japan. in the USA. Why it does not work ? So, this Research Tax Credit is currently 6.5 billion per year. Is this really research being done? One would expect that with this extra 6.5 billion, there would be more research personnel in proportion. And we see that this is not the case. So, does this mean that companies are retraining staff who were not previously in research into research staff? That is to say, basically, companies say they do research, but you even have doubts about the fact that they do research. There are companies which use the Research Tax Credit in a perfectly virtuous manner. There are others where probably weird things are happening. If we look at the number of researchers in companies, between 2007 and 2008, it suddenly jumped. It's still surprising, it's just the year when the research tax credit became allocated to the number of researchers. But you are saying that there are people who were reclassified, who were not researchers and who, suddenly, became researchers? Who become researchers because it allows them to enter into what is eligible for the Research Tax Credit. However, is the money that is spent, 6.5 billion euros per year in France, that's not nothing, well spent? Listening to you, right? So, it all depends on knowing what we call well spent. If the goal is to tell companies the tax pressure in France is high, with this Research Tax Credit, there are 25,000 companies who will have a lower tax pressure, at that point, it is well spent. It is not my place to criticize the fact that the State wants to help businesses overall. But for half of the amount, it is used as a tax loophole to reduce the tax burden. Let's accept it. You are telling us that this is hypocrisy. It's hypocrisy. Hypocrisy, damn it! Mr. Mayor, you are going strong. Let's take a closer look at this. The CIR weighs more and more heavily on public finances. From 132 million euros in 1983 to 4 billion in 2008. This year it would reach 6 and a half billion euros. An inflation that the Court of Auditors has denounced since 2013. It points to the tax support mechanism for business research and development the most generous of the OECD, the organization which brings together around thirty developed countries. The Court of Auditors also warns of heavy management and risks of fraud. The senators then decided to take an interest in this tax loophole. Where do the billions paid each year to companies to help them innovate go? The Senate has just opened a parliamentary commission of inquiry. In 2015, this commission of inquiry is responsible for writing a report on the Research Tax Credit. Made up of 21 members, it brings together all political parties. Corinne Bouchoux is appointed vice-president of the commission. She is convinced that she will be able to carry out her mission. except that she will never attend the publication of this report. It's time to tell you the incredible story of a report that ended up crushed. The report has not been released and therefore in the Senate, it must be the only one that self-destructed by a solemn vote. How did we get here ? Listen carefully to the rest of the story. For six months, senators will hear researchers, experts, but also industrialists. Like Renault, which is going to defend the CIR, even if it means a little blackmail for employment. Research and development are among the easiest activities to outsource because they basically require no resources other than the intelligence and talent of engineers. Industrialists are also getting involved behind the scenes. And it is the president of the commission, Francis Delattre, who reveals it to us. It took a while to convince him, but obviously he seems happy to be there. Well listen, there are worse things. Have any business leaders come to you to say yes, “Yes, it’s really important for us”... How was it going? The commission of inquiry, as soon as it became known, was not about business, it was an avalanche. The very large industrialists, the very large, naturally, they went through President Larcher and said be careful. There was something at stake, in fact. Of course. Because I didn't get Mr. Ghosn on the phone, but he did. Well, you shouldn't say that. Mister who? Ghosn, finally the boss of Renault. Ah yes, Ghosn, Carlos Ghosn. Yes. Larcher told me to come see me. So I went to see him. And naturally, we talked about the commission. And that we agreed that it was a useful device for the country and its productivity, that there was no discussion on that. All united to defend the CIR. And from the start of the auditions, Francis Delattre announced it loud and clear. Do not fear anything from the commission of inquiry. It is there to ensure a long life for this device. Businesses will also find support from the government of François Hollande. Christian Eckert was then Secretary of State for the Budget. Today, he is no longer in Bercy, but he agreed to meet us at his home, in his small village near Metz. And what did you bring back from Bercy, here and there? Secret files. This is an email that I “scrambled”, that I found in a drawer. This is the report from the Swiss police. What happened, the edits they were making. He seems to have some, from the file. But what we came to look for was information on the CIR. And on the CIR? CIR, there is no secret. No secrets, but still instructions. Why was the Research Tax Credit so protected? For a relatively simple reason, France has a reputation for taxing businesses heavily. But France, if I dare say, it counteracts this first element, is renowned for having an attractive and interesting Research Tax Credit system , we will say favorable, some may think too favorable. And so we had taken the side, at least for me it was a clear instruction that I had from the President of the Republic and from the various prime ministers that I was able to work with, it was not to touch the Tax Credit Research so as not to give the feeling that this element of attractiveness could be called into question. Government, Senate, everyone is on the same line. But that’s without counting on the rapporteur of the commission of inquiry. She is the one who must write the report on the CIR. Senator Brigitte Gonthier-Maurin is determined to investigate a particular aspect of the system. There is a subject that has been rarely discussed, and that is the question of tax optimization. Ah yes, tax optimization! The senators had almost ended up forgetting it. After six months of hearing, Brigitte Gonthier-Maurin completes her report. But before making it public, it must receive the approval of the majority of the commission. Corinne Bouchoux, the vice-president, is present at the time of the vote. Each senator has a copy in front of them where they can express their point of view on the report. And then I understood very quickly, after very little intervention, that it was going to be complicated. Only 8 senators voted for. 10 vote against. 3 abstain. The report is rejected. Copies of our report went to the shredder and are therefore deemed never to have existed. As I remember, we were also reminded that since the report was supposed not to have existed, if some people had kept extracts or views of this report, they could not make use of them. In fact, the report is as if it had not existed. That's quite astonishing. Francis Delattre, who voted against the report, claims to have been congratulated by a minister. What I can tell you confidentially, but you can say overall, is that I did receive a telegram from a minister, thanking him. His name was Emmanuel Macron. Did you keep the telegram? Ah well, there is interest, yes. For my memories. What was written there? That he was aware of our position on... That for businesses, this is good news. Thank you. You can say it. Questioned about this telegram, Emmanuel Macron did not answer us. In any case, the torpedoing was carried out according to the rules of the art. But there is one copy that escaped the shredder. Yes Yes. We assure you. And imagine we got it back. We won't tell you how. Four years after the famous vote, we will finally know why this report caused such a political battle. We were a little surprised. The report does not talk about abolishing the CIR. No, just to control it. Tax expenditure is insufficiently controlled and its management can be improved. The rapporteur points out major weaknesses during the tax audit. And concludes that, in fact, CIR control does not work well. I think we found this report. I'm going to show it to you, you're going to tell me if, in your opinion, it was the one. Could it have looked like this? So it might look like this. So, wait, I'll look at the titles. Yes. Yes, it really could look like that. We confirm it to you, it is indeed the correct report. That 's what we discovered. The weak link, in fact, was control. So a poorly controlled system is a system that can potentially lead to either optimization or fraud. And I think that's what our report showed. It was this, “at the same time”, where it was shown that both the control was weak, and that the system itself encouraged fraud through its operating mode. We managed to find a copy. I'll show it to you. There aren't 36, are there? Yes, it looks like that, yes. When we read the report , we ultimately have the impression that this report aims to better regulate the Research Tax Credit, but not to destroy it. So, it's hard to understand why it didn't come out. Since you say that it is a system which allows public money to be diverted, you are not going to keep it. Mr Delattre, she points out a major risk of slippage on the part of large companies. You do not share this observation? Absolutely not. This is all... It's a priori. Of course, Mr. Delattre, all these risks of slippage are a priori. Continuing our investigation, we discovered that there was not only the CIR, but also the Super CIR, XXL format tax optimization. And we learned that thanks to this email received last January. A letter addressed to the National Financial Prosecutor's Office, the institution which tracks major financial delinquency. Suspicions of tax fraud, lack of control, irregularities, intellectual and scientific fraud, embezzlement of public funds. The one referred to in this letter is System X. It's what we call an IRT, a technological research institute. Its goal ? allow private companies to work in collaboration with public research. These companies are flagships of the industry. Renault, the leading French automobile group, Alstom, one of the transport giants, DCNS, nuclear attack submarines, Thales… In fact, we received a little ad with it. It will be easier to explain to you, look. We stand alongside those who have big ambitions. Make the world better and safer. System X is located in Saclay, in the Paris region. This technological research institute was created by the State in 2012. To boost research in companies. 120 high-level scientists work there, on sensitive issues: Defense, cybersecurity. But today, some of them are exhausted. Since the start of the year, 30 employees have resigned. One of them agreed to speak to us face to face. He is a researcher. Why did you agree to testify today? According to the researcher, the IRT would therefore be a subsidy window that businesses would use. Demonstration. A group of companies wants to develop a 1 million euro project. To reduce the cost, it will join forces with the IRT. Thanks to this partnership, the State covers half. The cost for businesses then drops to 500,000 euros. And that's not all. As the project is carried out with the IRT, the Research Tax Credit is not 30%, but 60%. In the end, companies only pay 200,000 euros. This private research, however, will cost the State 800,000 euros. Even better than the super jackpot! Because there, you win every time. The IRT invented the super optimization machine. When it comes to tax optimization, in general, we prefer to remain discreet. We prefer the Duchy of Luxembourg to the Saclay plateau in Essonne. With IRT, tax optimization is near you. This is also how the former deputy general director, François Stéphan, sells his institute to potential investors. There is certainly an initial investment, but in the end the company is necessarily a winner. In the end, it still costs the company. This requires it to invest in its own R&D funds, but it is extremely optimized. Extremely optimized, okay. But does IRT make it possible to develop more research in companies? Let’s take a closer look at Renault. With IRT, Renault imagines the automobile of the future. And in particular securing the autonomous car to prevent it from being hacked. Except that for some IRT researchers, one of these projects would be in vain. This IRT engineer prefers to remain anonymous. He has been assigned to this Renault project for several months. And he too, like the car, felt very autonomous. When you work on this project, do you normally work for Renault, with Renault? And did it happen like that? And did you succeed in carrying out your mission? In these conditions, what does the IRT researcher do? The researcher writes a whole bunch of reports. But what can they be used for? In fact, to benefit from the Research Tax Credit, you have to prove... well... that you are doing research. Obviously, we asked for interviews with the IRT and Renault. They responded to us by email. Reading them, everything is fine. For System ​ ​ It is the DGFIP, the General Directorate of Public Finances, which is responsible for verifying these systems. We met one of these agents. Subject to confidentiality duties, he speaks anonymously about his difficulties in controlling the CIR. Asked, the Ministry of Higher Education confirms that the service has 11 full-time people, and claims to have a pool of 600 external experts to monitor research. In total, the ministry contributed to the completion of nearly 800 assessments in 2018. This seems low compared to the 24,000 Research Tax Credit files submitted each year by companies. This weakness in controls is what shocks some scientists. We meet Patrick Lemaire, the research director at CNRS. On the one hand we have research, private R&D, which has nothing to justify, which will have 6.5 billion euros. On the other, public research, where we spend a whole part of our research time. Looking for money and justifying it. The Research Tax Credit, you basically tell us that it benefits from 6.5 billion euros almost without justification and that on the other hand, you, public researchers, spend an infinite amount of time finding credits... justify and use them. But because the image we can have of public research is that researchers do what they want in their own corner without being accountable to their supervisory authority. Is this the case? Oh well no, that’s totally false. We are constantly accountable. I will report back every year with an activity report. Every researcher must do this. Every two years, we will have to write a document that details what we did during these two years. And then every four years, we will have to produce a long document which will detail everything we have done during the four years. So that means you are very controlled. And then every five years, the entire laboratory will be checked. So that means that every single piece of public money allocated to you is then controlled. Completely controlled. But doesn't it shock you that there is precisely, when you see these sums of money, once again 6.5 billion euros per year given to the Research Tax Credit, that part of this sum does not go to public research? It has now been 20 years since France committed to spending 1% of its gross domestic product on public research. We stay at 0.8, that doesn't change. There is a shortage of 4.5 billion euros per year. So that France simply meets its international commitments. 4.5 billion euros per year seems enormous, but it's not that much. It's twice the budget of Ligue 1 football clubs. It's... I mean... The State can find this money. Afterwards, if they want to invest 6.5 billion euros in private R&D, in private research and development, they should do so with measures which are effective, which are assessed and which take into account the results of the assessments. . With the Research Tax Credit, do you have the feeling that the public authorities have favored private research over public research? The problem is not so much that the State wants to stimulate private research. He is in his role, in my opinion. The problem is that he does it ideologically, ignoring the various expert opinions that are done, and which say that it is not a mechanism that works well. Do you mean that the State does not hear criticism of a tax system which could be effective but which today is not? Currently, what emerges is that ten years after the change in the Research Tax Credit which means that it went from 2 billion in 2007 to 6.5 billion now, there is nothing that allows you to be completely convinced. If you want... Is there nothing that justifies such a huge increase in credit? If in public research we gave so few arguments that what we are doing is useful, our funds would be completely cut. Non. Because there is an a priori which is ideological about this Research Tax Credit. Trust, we tell you. So important in economics that it would guide major tax reforms. And too bad if it costs billions of euros to the state budget. For sometimes questionable results. This is the end of this new issue of Cash Investigation. You can find us in replay on the France Info website and application, magazine section. And if you're not yet satisfied, stay with us for the rebroadcast of our seed investigation. Multinationals: Hold-up on our fruits and vegetables is a film by Linda Bendali. Excellent end of the evening on France 2. Thank you, good evening.