ECONOMY

Alogoskoufis claims some success in tax evasion fight

Economy and Finance Minister Giorgos Alogoskoufis yesterday urged tax officials to intensify their efforts in the battle against extensive tax evasion, particularly as regards illegal fuel trading, but also to show full respect for the rights of taxpayers. «We cannot speak of a strong economy and fair government as long as we have high tax evasion,» he said. «There are no small or big cases. They are all equal before the law.» Speaking to staff in the Finance Ministry’s special inspections department (YPEE), he said initial results from the operation of Ifestos – the computerized system for monitoring fuel trading from customs to the consumer – indicated illegal sales in the farming sector, as well as excessive consumption of heating oil in hospitals, hotels and universities. He urged officials to begin inspections as soon as possible. The Ifestos system was introduced in February with a view to stopping large quantities of heating fuel, which is subject to a much lower tax for consumers, from being sold as automotive diesel. Under the new system, distributors must now pay the same tax for both types of fuel. They sell heating fuel minus tax which is then reimbursed by the government. Alogoskoufis said the results showed a 20 percent increase in sales of automotive diesel since the launch of the new system, which points to the success of the measure. He said he would announce further measures against illegal practices in fuel trading at the end of May. They are to target bunker fuel, petroleum products destined for export and refineries. Deputy Finance Minister Antonis Bezas said inspections should focus on occupations showing a higher frequency in the issuance of bogus receipts. Budget Separately, Finance Ministry data showed a significant shortfall in targeted budget figures in the first two months of the year, as primary expenditures were over target and revenues lagged. However, inflows of European Union investment subsidies and a significant decline in interest payments created a surplus of 552 million euros. Primary expenditures were up 12 percent, against an annual target of 8.3 percent, while revenues rose 10.2 percent, compared to a 13 percent budget target. The ministry considers the overrun in primary expenditures to be a conjunctural phenomenon, largely the result of the introduction of a new pay structure for the security forces. Total expenditures, it said, were up only 5.7 percent, against a target of 8.1 percent for the year.