The bug that recalls the IT deficiencies of the tax authorities

On June 3, the influx of taxpayers wishing to declare their 2018 income created a bug on the tax website. “The site is currently under maintenance, could we read there in the evening. We apologize for the inconvenience caused.” Asked about this failure, the Minister of Public Accounts, Gérald Darmanin, procrastinated the next day: “There were more than three million connections in half an hour. The site believed in an attack. After this weekend sunny, many French people chose to file their tax return at the last moment. ” Hundreds of thousands of taxpayers have been prevented from declaring their income, according to the minister, and Bercy extended the deadline to June 6 in the evening.

This bug taints a hitherto successful transition from withholding tax to income tax. In a report on the IT of the tax administration submitted to members of the Finance Committee in mid-May, the Court of Auditors welcomed the “first satisfactory results” of the withholding of income tax. “As a government priority, the withholding tax was the subject of a specific steering mechanism and significant financial resources which resulted in the successful implementation of the reform”, underlines the report, that Challenges procured. It is true that the widespread bug that some feared ultimately did not happen.

The Ministry of Public Accounts has put the means to succeed in this reform which has affected some 17 million tax households as of January 2019. Minister Gérald Darmanin himself chaired the weekly meetings for the implementation of the withholding tax from September 2018 and Bercy dedicated a total investment of 178 million euros in 2017 and 2018. This is an amount 25% higher than the budget initially planned. “The evolution of the cost is explained in particular by the decision to increase the effort to support the change, notes the Court, by strengthening communication campaigns.” In September 2018, several TV spots had been broadcast.

717,000 households revised their tax rate in January

The introduction of withholding tax above all required large IT and human resources. More than 400 tax IT specialists were mobilized to adapt in-house software and, contrary to its custom, the tax administration (DGFIP) made extensive use of private service providers. The tax reception services were also involved: in January 2019 alone, they answered 1.4 million phone calls, 130,000 emails and 1.2 million visits to the counters. At full speed, Bercy expects an operating cost of 14 million euros per year, mainly based on labor.

“The DGFIP has succeeded in carrying out this reform on time and in a satisfactory manner”, congratulates the Court of Auditors. In January 2019, the withdrawals took place “without major dysfunction” for the 13.3 million retirees of the general scheme and the 25 million employees of the private and public. Some 8.8 million tax households even benefited from the advance payment of 60% of their tax credits for a total of 5.5 billion euros, or 627 euros per household on average. As of January, 717,000 households have used the possibility of modifying their marital status via the Internet: 174,000 have seen their tax rate revised upwards and 404,000 downwards, or even reduced to zero for 113,000 of them.

65 “obsolete” computer applications

All is not rosy, however, in the IT departments of the great tax department. The Court of Auditors warns about the multitude of software and the stacking of “aging systems”.

No less than 740 IT applications coexist at the DGFIP and the 4,689 tax IT specialists are simultaneously leading some 300 software redesign projects. The “insufficient management” of IT projects leads to “significant cost overruns and deadlines”, deplore the magistrates.

In particular, the Court is sounding the alarm on the obsolescence of many software, some of which date back… to the 1970s! “The DGFIP considers in 2018 that 65 applications, or 9% of the whole, are obsolete, notes the Court. Many of them nevertheless fulfill strategic tasks.” Like the one that manages payrolls and civil servants’ pensions (PAY) or important applications for tax collection (REC) or personal taxation (ILIAD).

This old age of IT systems forced the DGFIP to devote 82% of its 563 million euros IT budget to the operation and maintenance of applications, “leaving new investment projects a very small part”. With 10 to 15% of its IT budget devoted to major modernization projects, the tax administration is well below the other public organizations (27%) and private groups (35%) studied by the Court.

563 million euros of IT budget

More broadly, “the share of IT spending in the overall budget of the DGFIP amounts to 6.7%, a level significantly lower than that of foreign tax administrations, but also of social security administrations”, point out the magistrates. The American and Swedish tax administrations devote 19% and 21% of their budget respectively to IT, while the retirement branch of the Social Security allocates 13% of its loans and Pôle emploi 10.8%.

Basically, the Court of Auditors criticizes the DGFIP for not having “formalized its IT strategy” and sees it as “incongruous”. “A very unique situation compared to comparable organizations” which “weakens its ability to carry out its digital transformation”, tackle the magistrates. Another weakness: IT professionals are increasingly difficult to attract into the tax administration. Almost 35% of the programmer positions open for competition over the past three years have not been filled. And the DGFIP is struggling to recruit contract workers “because the salaries offered are not competitive”, she argues. The taxman, that had paid?