BUSINESS

Debts to state keep growing, topping 101 bln at end-June

Most bank accounts that tax authorities freeze turn out to be empty.

TAGS: Finance

Taxpayers’ expired arrears to the state soared to 5.19 billion euros in the first half of the year – that is before the heavy tax obligations started in July. At the same time, the monitoring mechanism has been confiscating or freezing about 360 bank accounts per day, although it is increasingly finding empty accounts.

Figures released by the Independent Authority for Public Revenue showed there are 3,727,416 individuals and businesses with debts to the state, adding up to over 101 billion euros. This is an amount that has been growing every month as many taxpayers can no longer meet their tax obligations, leaving their dues unpaid.

Of the 101.3 billion euros owed to the state, 5.19 billion euros appeared in January-June this year. Unpaid taxes (excluding fines) amounted to 4.164 billion euros, rising by 392 million euros in June alone.

About one in every four taxpayers – i.e. 1,694,042 – face forced collection measures, which have already been imposed on 1,137,235. In June alone 9,032 asset seizures were made.

Of the 101 billion euros due to the state, some 15.9 billion has formally been declared noncollectible, which takes the actual amount due to 85.4 billion euros.

The wave of confiscations appears to be paying off for the state, as more than 2.69 billion euros of old and fresh overdue debts has been collected since the start of the year. That is quite an impressive amount when compared with previous years; however, in comparison to the total 101.3 billion, it’s merely a drop in the ocean.

The big challenge for the government will be July’s takings, as yesterday was the deadline for the payment of the first income tax tranche. Tax declaration figures show that some 2.5 million taxpayers will have to pay a total of 3.3 billion euros, 500 million less than in 2017.

In fact, one in three taxpayers was unable to pay the first installment of income tax last year: About 671,000 taxpayers failed to pay tax dues of 340 million euros. What the government is hoping is that taxpayers who are unable to meet their obligations will enter the Finance Ministry’s favorable payment scheme which offers them the option of paying their tax in 12 tranches.

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