GALAXIE, the new data mining tool for the Tax Administration’s service

For several years, the tax administration has used data mining processes to identify and analyze cases with great potential for tax evasion. It is in this spirit that the administration implemented the GALAXIE application on March 31, 2022.

I. Princip

The Transparency of Structures Screens (TSEs) program, set up in 2002, aims to establish the link between natural persons and the legal entities in which they have an interest.

This program has now been replaced by a more complete viewer program called GALAXIE. This tool was created by a decree of 11 March 2021, which entered into force by a decree published on 31 March 2022. Its purpose is to collect and consult information concerning taxpayers, both natural and legal persons.

GALAXIE allows the tax authorities to see all the equity relationships that exist between professional entities themselves, but also between professional entities and natural persons. GALAXIE also brings together so-called “context” elements about the economic and tax situation of these people.

All this information is gathered for the purpose of identifying certain files with “high potential”, which enables the tax administration to initiate investigations, investigations, programming, control and collection operations.

II. The nature of the information processed

The nature of the processed information is precisely framed by the device.

First of all, the decree stipulates that the personal identification data of natural and legal persons is strictly limited. In the case of legal persons, the SIREN number, the company name, the dates of creation and cessation of activity, the legal status and the activity performed are recorded. In the case of natural persons, only the tax number, marital status information and the identity of the spouse or cohabitant are registered.

The tax information processed collects basic information for companies and legal entities, namely the category of turnover, the tax obligations to be met (ie the taxes and duties that the persons have), the tax system, as well as the tax address. More information about natural persons is communicated through their reference tax income, the year of the tax return. An indicator also determines whether the taxpayer’s case has a high stakes or not.

This last concept demonstrates the uniqueness of the system, which identifies certain cases that represent a particular litigation issue. Therefore, identified taxpayers pose an increased risk of tax audit.

Finally, this application will cross personal and tax data with so-called context data. For legal entities, this will be data regarding VAT credit repayment, ongoing collective bargaining, fees paid, tax compliance, the service that manages the tax file, their bank account, the relationships between managers and associates, and the sensitive person indicator. The scope of data processed for natural persons is smaller, but nevertheless includes an indicator for so-called sensitive persons as well as data concerning connections between managers and associates.

The wide range of information that is communicated enables the agents to have an overview of the situation and thus carry out an effective tax and wealth analysis of the targeted taxpayers.

III. Guarantees in favor of the taxpayer

The legislature has provided two types of measures to regulate this new tool and provide increased security for taxpayers.

Firstly, as regards the persons capable of consulting the personal data, only the agents of the general management of public finances have territorial competence and are responsible for the control of the persons concerned as well as the authorized agents of the general management of customs and indirect rights responsible for control and investigation missions and debt collection in the fight against fraud. In addition, the latter only have access to personal data that is strictly useful for their mission and in accordance with the principle of the need to know.

The data available on GALAXIE comes solely from “Fraud Targeting and Request Valuation” (CFVR). The CFVR processing crosses the data that DGFIP stores at the personal, wealth and professional level thanks to the files FICOBA (bank accounts), FICOVIE (capitalization and life insurance contracts), PERS (natural and legal persons), ADONIS (personal tax account). ), or BNDP (national wealth database).

This personal, tax and contextual data is stored for a period not exceeding ten years from its collection. In this way, the taxpayer guarantees that the data will no longer be stored after a certain period.

The most important security measure deployed in this system relates to logging consultations of this data. In fact, each consultation of data is listed and specifies the author’s identifier, the references to the elements used, the nature of the actions performed, the reason for the consultation, the exports performed, and the date and time of consultation. This measure serves as a substantial guarantee in favor of the taxpayer who knows which agents have been aware of the information about him.

Nevertheless, despite these limitations, we do not know what use will be made of GALAXIE so that certain invasions of privacy could be feared. A significant limit to these guarantees deserves to be pointed out. The tax authorities’ affiliation data is stored for four years compared to ten years for taxpayer data. This difference in time puts the agent and taxpayer in asymmetric situations. Other problems will certainly be raised to the detriment of taxpayers once a sufficient setback has been observed.

In addition, a report is expected in the coming weeks to assess the relationship between the invasion of taxpayers’ privacy and the goal of the government’s fight against tax evasion using the CFVR tool, which retrieves the data contained in GALAXIE. This issue has become central, especially since Decree No 2021-148 of 11 February 2021, which allows the tax authorities to use data that is freely available on the Internet and especially on social networks.

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