Tax amnesty flops
20 October 2004, BRUSSELS – A much-vaunted Belgian tax amnesty designed to clamp down on people who ferret away undeclared earnings in foreign bank accounts has so far spectacularly flopped.
20 October 2004
BRUSSELS – A much-vaunted Belgian tax amnesty designed to clamp down on people who ferret away undeclared earnings in foreign bank accounts has so far spectacularly flopped.
The amnesty, which also applies to any expats registered for tax in Belgium, draws to a close at the end of the year but press reports on Wednesday revealed that only EUR 47 million had been recovered so far, representing just 5.5 percent of the target total.
Finance Minister Didier Reynders is in talks with banks about how to proceed.
The government had hoped to gain EUR 850 million from the amnesty but now concedes that the goal is unlikely to be achieved.
Reynders already lowered his ambitions this summer by announcing a new target of EUR 250-300 million.
Banks are now predicting that EUR 100-250 million is more realistic.
The scheme, which began in January, allows people holding undeclared earnings in foreign bank accounts to avoid penalties by filling out a declaration form – the declaration liberatoire unique (DLU) - by the end of the year.
People filling out a DLU would avoid prosecution and would only have to pay a relatively low level of tax on any funds stashed abroad illegally, providing they repatriate the money to Belgium.
But, with the exception of June, where EUR 17 million was collected, tax dodgers do not seem unduly worried by the law.
If the governments suspicions about the numbers of such people are correct, very few have come forward to fill out a DLU.
Reynders is remaining optimistic and says he believes between 60 and 70 million euro will be collected by the next two official deadlines on 15 December and 15 February.
This has been tempered, however, by an admission from the banks that claims of a rise in tax submissions and sums, were actually false.
Tax dodgers may still be caught out when a new EU directive on tax savings comes out in 2005.
[Copyright Expatica 2004]
Subject: Belgian news