Extra measures in the fight against tax fraud

“The days when tax backdoors were tolerated are a thing of the past,” Johan Van Overtveldt states unequivocally. As Minister of Finance, charged with fighting tax fraud, he is putting significantly more effort into that fight with a substantial package of new anti fraud measures. For example, a special Task Force will be established with experts in Finance and Justice. It will map problems around tax structures and provide additional solutions. “We cannot expect the average citizen and entrepreneur to obediently pay his or her taxes, when just on the other side of the bridge there is a minority who evades taxes on a large and organised scale,” the Minister explains, referring to the recent revelations about tax structures in tax havens.

“Over the past few weeks and months, a lot has drifted to the surface. After LuxLeaks and SwissLeaks, we have now been confronted with the Panama Papers. But let’s be honest: nobody really paid attention to those structures for decades. Politicians didn’t either. And as long as there is no signal that we, society and those who represent this society, do not think this is okay, not much will change. But we have arrived at a tipping point. Public opinion is no longer willing to let this happen, and neither am I,” says Johan Van Overtveldt.

Apart from the establishment of a joint Task Force of Finance and Justice, the package also contains the following important measures:

• Quicker processing of fraud cases: The number of tax officials at the disposal of Justice doubled from 15 to 30, allowing such cases to be processed more quickly, also at the legal level.
• The investigation term when information from abroad is received has been extended to 24 months.
• Better exchange of information about tax structures with Panama.
• Adaptation of collection legislation must prevent fraud money from disappearing abroad before a judgement has been issued in the case.
• Simplified garnishment via registered post and digitally: In case of garnishment, the possessions of the debtor are not seized, but only that which is owed the debtor from a third party. This currently takes place quite inconveniently, via a bailiff’s writ.
• Access to digital evidence: Accounting data to be found in the so-called cloud, can also serve as evidence from now on. Until now, inspection departments have only had access to data physically located in Belgium - on a server that is also effectively in Belgium, for example, in the case of digital data.
• Non-declaration leads to higher penalty: The administrative penalty for not declaring tax structures for which the Cayman tax Named after the Cayman Islands, one of the largest tax havens in the world. Also known as the “transparency tax”. The Cayman Tax ensures that complex foreign financial structures can no longer evade the tax authorities. These are often structures that allow assets to float between two owners, via trusts for example, so that neither party is taxed. Cayman tax is intended, has increased from 1,250 to 6,250 euros per non-declared structure. That penalty is added to the tax increase that arises from the declaration itself.

Minister Johan Van Overtveldt points out that this government did not wait for the Panama Papers before taking action: as of last year, for the first time there has been an instrument in the Cayman tax or Transparency tax Also known as the “Cayman tax”, after the Cayman Islands, one of the largest tax havens in the world. A transparency tax allows the tax authorities to look through complex financial structures abroad and to tax the assets in these in their country, if the assets were only parked there in order to avoid taxation. transparency tax , which can see through structures in tax havens and tax them. “We have taken an important step forward with this package of extra measures,” he concludes.