Filenews 2 March 2024 - by Eleftheria Paizanou
4,464 inconsistent taxpayers were brought to justice for tax debts totalling €359.7 million.
The legal action against these taxpayers had been taken in the third quarter of 2023, i.e. from July 1 to the end of September, and concerns debts only in direct taxation, as it does not include data in relation to VAT owed.
According to the Tax Department, the data result from the implementation of the first phase of the new Tax For All computer system last March, while two more phases remain for its full operation, so data cannot be extracted from the Tax Department on VAT debts.
Consequently, the number of debtors who ended up in court is much higher. In detail, the initial tax to be paid by the 4,464 taxpayers amounted to €166.4 million, however, due to their non-compliance or inability to pay, an additional cap of €158.1 million was placed on the debts, related to interest, as well as other charges, amounting to €35.2 million.
In the previous two years, the average number of debtors, i.e. natural and legal persons who owed VAT and were brought to justice, was around 1,100. Specifically, in the corresponding period of 2022, the Tax Department took legal action for 4,586 natural and legal persons, for direct tax debts amounting to €365.1 million, as well as against 1,128 persons for non-payment of VAT of €73.2 million.
Moreover, in 2021 tax debts amounting to €461.2 million were under judicial measures, while in 2020 judicial measures had been taken for debts of €527.5 million. Criminal proceedings against legal and natural persons are made for failure to pay withholding taxes, such as VAT, special contribution for defence and for failure to submit income tax returns.
MEMO and freezing of deposits
According to the quarterly progress report of the Tax Department on the status of the amounts immediately due, which was sent to Parliament and concerns the third quarter of 2023, in addition to the legal measures taken for debts amounting to €560.6 million, the Commissioner of Taxation proceeded to take other measures concerning the registration of a lien on immovable property, i.e. MEMOs, while bank deposits of debtors were also frozen.
In detail, a MEMO was placed on the properties of 6,851 taxpayers, who owed direct taxation and VAT amounting to €559.5 million. At the same time, the Tax Department proceeded with the freezing of bank accounts amounting to €1.09 million. It is noted that 259 taxpayers who had debts amounting to €15.7 million have settled their payment by paying monthly instalments.
At €3.4 billion. the total amount owed to the Tax
According to data from the Tax Department, the total amount of taxes due to the state until the third quarter of 2023 was €3.4 billion. The amount immediately due for which no action has been taken reaches €1.3 billion.
Compared to the corresponding quarter of 2022, debts have increased in 2023, as at that time their total was €3.11 billion, while the immediately payable, for which no measures had been taken, was €898.5 million. However, from time to time the Tax Department in its announcements claims that it is the lowest number of tax debts as this includes debts of many decades.
From the analysis of the Department's data on last year's debts, from July to September, an amount of €1.56 billion presents a temporary or permanent impediment, as well as difficulty in recovery. Rather, the State considers a permanent loss of €120.5 million owed by 8,552 persons, as despite the efforts made by the competent department, the debtors have not been identified, either because they are abroad or because they have died.
There are also obstacles to the collection of tax debts of €185.5 million. owed by 2002 taxpayers, as they do not own assets that can be liquidated, have no other sources of income and access to loans to repay.
