French Probe Uncovers €13M Luxury Car Tax Fraud Scheme in Andorra
Authorities exposed a scheme where French clients used sham rentals to buy luxury cars in Andorra, evading €12.756 million in taxes. All 170 face penalties amid Franco-Andorran crackdown.
Key Points
- 170 French buyers implicated in €12.756M fraud using fake rental contracts to dodge 20% TVA and eco-malus.
- Buyers registered high-end vehicles like Porsche and Ferrari in Andorra at 4.5% IGI rate.
- Toulouse prosecutor Nicolas Jacquet reported all buyers; 20 locals involved, one organizer identified.
- Joint Franco-Andorran probe led to 2 arrests in Andorra; Toulouse tax crime cases doubled to 159.
French authorities have quantified a tax fraud scheme involving luxury car purchases in Andorra at nearly €13 million, implicating 170 French buyers between 2024 and 2025.
The operation relied on fictitious rental contracts to disguise sales, allowing buyers to register high-end vehicles in Andorra. This enabled them to pay Andorra's 4.5% IGI rate instead of France's 20% TVA, while also evading the malús ecològic—a French penalty on high-emission vehicles. The exact fraud amount stands at €12.756 million in lost French public revenue.
Toulouse Appeal Court prosecutor Nicolas Jacquet disclosed the details, noting that all 170 buyers have been reported to tax authorities for sanctions and back payments. Around 20 of those involved reside in Toulouse, a city with strong Andorra ties, and authorities have identified a local figure there as the scheme's organizer.
Investigations, conducted jointly with Andorran judicial and fiscal bodies, led to two arrests in Andorra in 2025. Both individuals are now free: one after serving an agreed sentence, the other awaiting further proceedings. No trial date has been set.
Jacquet praised the cross-border effort, calling it a strong example of Franco-Andorran collaboration that identified perpetrators and clients.
Andorra's automotive sector views the issue as resolved. The dismantling of implicated dealerships and fear from police actions in both countries have ended the practice, mainly targeting French clients. Sales of brands like Porsche and Ferrari returned to normal levels by late 2025 and into early 2026, though slightly higher than in neighbouring areas but far below 2024 peaks.
Industry sources acknowledge the operations exploited a regulatory gap for profit, prompting French pressure on Andorran authorities. While buyers face regularization, cases against Andorran sellers may be dropped, with outcomes in Andorran proceedings still pending.
Toulouse has seen tax crime cases double over the past year, from 82 to 159.
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- Altaveu•
El sector de l'automoció dona per superat els episodis dels 'falsos contractes de lloguer'
- Diari d'Andorra•
El frau de la compra del cotxe de luxe a Andorra implica 170 francesos
- Altaveu•
França xifra en tretze milions d'euros el frau pels 'falsos lloguers' de cotxes de luxe a Andorra
- Diari d'Andorra•
Una vintena de residents de Tolosa implicats en un frau amb cotxes de luxe a través d’Andorra