An emergency action plan, which will be deployed on 7 fronts and aims at the recovery of tax revenues, is being prepared by the financial team of the government.
The main aim is the immediate stabilization of tax revenues and tackling the "black hole" in the budget, which has already reached 1.5 billion euro.
The plan foresees inspection through express procedures of 100,000 companies and individuals, freelancers with outstanding tax relations, inspections according to 10 criteria in joint stock companies and limited liability companies, new rules for repayment of overdue liabilities to the state, a regulation for the payment of additional taxes in 10 installments, incentives for capital return in Greece, differentiation of the violation "not paying overdue to liabilities to the state" from the violation "tax evasion", taxation of unreported income to date.
The government financial team will this time implement shortened procedures with which to offer companies a more favourable way to find a compromise and settle their tax obligations.
Initially, tax authorities will issue orders for inspection of the companies' outstanding tax issues to date, and immediately afterwards the inspection itself will start via the shortened procedure.
Inspections will be carried out quickly. For every trader, they will end within a maximum of three days and will be conducted according to specific criteria. Express inspections will be carried out with priority for traders who:
- Have significant breaches of the Code for data and books of accounts, or where there is information about tax evasion.
- Have not submitted tax returns for income tax, VAT or other tax items.
- Have a large credit balance on VAT, which is not consistent with the area of activity of their firm.
- Have seized books of accounts data, or cash registers.
- Have declared lost books of accounts and data.
- Have declared high expenses.
- Have not defined correctly their net profit.
- Have an unfounded difference between the data from tax returns for income tax and the VAT returns.
- Have declared gross income which does not comply with the rest of their financial parameters.
- Have submitted returns from which a low rate for the gross and net profit stems.
- As of 1 January 2008 have owned buildings and regulated land on a total amount of over 400,000 euro.
Inspections on 10 criteria
Regular tax inspections are expected with the application of 10 criteria in small and medium-sized joint stock companies and limited liability companies. In particular, the following will be considered:
- The acceptance or issuance of fake - virtual tax documents.
- Relations with nonexistent companies.
- Goods with invoiced price higher than the actual price.
- Data or signs of violations of tax laws from internal or external sources.
- Non-issuance of a report on tax compliance by private auditors and audit firms.
- Report by the auditors that they weren't provided the necessary data for the tax inspection.
- Cases with inspections of companies where data exist for violation of rules by auditors and audit firms.
- Bringing charges against Management Board members in accordance with the rules for legalization of revenues from criminal activities.
- Focusing of more than 70% of the inspections for the sector on one and the same audit firm.
- Results from quality control.
New regulation for overdue liabilities
The introduction of a new regulation for the repayment of overdue liabilities to the state in a lot of smaller monthly installments, the number of which could reach up to 60, is foreseen. This measure is put on the negotiating table with the Troika and provides for the acquittal of those obligations either by a single write-off of additional increases, or by monthly installments - from 2 to 60.
Arrangement of additional taxes
The financial team of the government is also foreseeing a new regulation for payment of additional taxes in 10 monthly installments for taxpayers with a family income of up to 100,000 euro. Taxpayers have to submit an application for payment of tax liabilities in monthly installments, as by February 2013 they must have paid 70% of their obligations, and in the next three months the remaining 30% of their duties.
Incentives for return of capital
"The Ministry of Finance is already exploring means for the returning of capital in Greece", said Deputy Finance Minister Giorgos Mavraganis, noting that one of the ways is their individual taxation.
Declaration of undeclared to date income
The Ministry of Finance provides for a special legislative act which will offer a last chance for taxpayers to declare to tax authorities 'grey' incomes, deposits in Greece and abroad, which come from illegally acquired incomes, as well as from movable and immovable property, and which they have misrepresented to the state. The plan, which is currently being examined by the Ministry, provides for the imposition of lower tax rates on income and property which will be declared.
Decriminalization of liabilities to the state