France Using A.I. To Find Thousands of Untaxed Pools

France is experiencing its worst drought on record, and the country’s tax authorities are using artificial intelligence to find thousands of undeclared swimming pools.

Federal officials have used software created by Google and a consulting firm, Capgemini, to find 20,356 previously undisclosed pools since last October. Aerial images are analyzed by the system’s AI software to determine the boundaries of swimming pools, which are then compared to publicly accessible property records.

The software appears to have been incredibly successful. Tax officials announced on Monday that the program, which has brought in an extra $10 million for nine French regions, will now be rolled out across the country.

French Rules Regarding Taxation of Swimming Pools

Due to the potential increase in property value, swimming pools in France are subject to taxation. Within ninety days of any swimming pool’s completion, the homeowner must file a tax report declaring the pool’s existence. According to reports, the government projects that implementing the AI software nationwide will generate $40 million in additional taxes in 2023.

The demand for swimming pools skyrocketed during the coronavirus pandemic, when millions of people were forced to quarantine at home, and has persisted throughout the summer, while Europe has experienced some of its hottest temperatures on record. According to recent statistics, there are approximately 3.2 million residential swimming pools in France with over 240,000 built during 2021 alone, according to France’s Federation of Pool and Spa Professionals.

Backyard swimming pools have long been a target for tax officials. Nearly 17,000 private pools were discovered by Athens tax authorities using satellite imagery during the Greek debt crisis a decade ago, but only 324 of them were declared by their owners.

How The AI System Works

The French AI system isn’t perfect – but close to it. The AI apparently sometimes confused solar panels for swimming pools and missed some vessels because of dense foliage. Eventually, tax officials hope to use the system to discover undeclared home extensions like verandas and pergolas, according to officials.

The French tax agency claims that the algorithm was improved through machine learning as it was tested, so it now has a very small margin of error. Ninety-four percent of taxpayers contacted by authorities after being flagged by the tool confirmed they had a taxable swimming pool.

As might be expected in a country like France, the integration of A.I. and aerial photography has sparked considerable political debate. Unions representing French tax collectors are opposed to the effort, fearing that it will “replace field work by tax collectors and surveyors”. They question the reliability of the system and are concerned that tax collectors and surveyors, who have deep roots in their communities, will be phased out in favor of desk workers reviewing the output of algorithms.

The announcement by the French government comes on the heels of ongoing concerns about the drought in France. Water restrictions have become more common and increased calls for energy conservation have already led to increased calls to regulate the use of swimming pools, despite scorching temperatures.