This is an interesting little point from Thomas Piketty, the French income tax system does not use tax withholding unlike the tax system of just about every other rich nation. This is something that has been passed into law, that such withholding should arrive, but it's also something that Macron seems to be against. That's just a little oddity of course, but it does show that Milton Friedman was right on yet another thing. Tax withholding allows the government to charge a higher rate of tax. The insight is obvious--we feel much less pain about having a regular portion of the wages we never even see being taken than we do if presented with one humongous bill each year.

Thus we would expect a country without withholding of income tax to have a lower general rate of income tax. And that does indeed seem to be true.

Piketty is here:

What are we talking about? The deduction of income tax at source was implemented in 1920 in Germany and Sweden, during World War Two in the United States, the United Kingdom and the Netherlands, and in the 1960s-1970s in Italy and Spain. France is the only developed country which has not introduced this. This is one of the most archaic aspects of our tax system and our administration. In this respect, we are between 50 and 100 years behind all other countries.

Further:

The truth is that deduction at source has already been established in France since 1945 for social contributions. In total, income deducted at source amounts to more than 20% of GDP, if one includes all social contributions (including CSG), whereas income tax represents less than 4% of GDP.

Friedman did not invent withholding of course, given that it was implemented in at least one country when he was still in short trousers. But he was very much he man responsible for introducing it in the US:

It was a very interesting and very challenging intellectual task. I played a significant role, no question about it, in introducing withholding. I think it's a great mistake for peacetime, but in 1941-43, all of us were concentrating on the war. I have no apologies for it, but I really wish we hadn't found it necessary and I wish there were some way of abolishing withholding now.

The reason why he didn't like it is that it means government can charge us more in taxes:

If the $5,581 were gradually taken out of one's paycheck over the course of the year and no money was owed on April 15, the pain of the theft would be greatly diminished, but for two entirely different reasons. Obviously, it is less painful to have $107.33 taken out of one's check every week for fifty-two weeks than writing a check to the government for that amount every week or a check for the whole amount once a year. The second reason the pain of the $5,581 loss would not readily be felt is that very few people pay any attention to the amount of taxes that are withheld from their pay. They are concerned only with their take-home pay.

A perfectly rational being would see the two for what they are, exactly equal. We humans are not perfectly rational beings and thus we don't. So, withholding allows higher tax rates. I, and Friedman, think this a bad thing. Your view may vary.

But to the use of this as proof that Friedman is right. France is generally a higher tax country than the US. Actually, about twice--the percentage of GDP cycled through the state in France is almost exactly twice that cycled through all levels of government in the US. For example, where they do have withholding, those social security taxes, they are much higher than the equivalent FICA in the US. But then look at the income tax. It's 4% of GDP in France, near 10% for the federal individual income tax (ie, before we look at state income taxes). That is, a generally higher tax country has a lower income tax take than a generally lower tax one, at least part of which is because of that absence of tax withholding.

OK, alright, I'd be hesitant to ascribe it only to that but it is at least highly suggestive, isn't it?

As to the policy implications here, if you truly want to lower the amount government takes in taxes then move to a system where all tax must be paid on just the one day, the individual turning up to the office with the amount in cash. That would start a certain movement for a lowering of the total take, wouldn't it?