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Cyprus

€1m in dodged taxes already taken from ‘Lagarde List’ accounts

Finance Minister Harris Georgiades claimed on Monday that many of the government's economic reforms had been introduced

By Angelos Anastasiou

About €1 million in previously unpaid taxes has already been seized from bank accounts by the Taxation Department, and undeclared deposits found in the ‘Lagarde List’ will be taxed by month end, Finance Minister Harris Georgiades said on Thursday.

In his speech to parliament regarding the 2016 government budget, Georgiades congratulated deputies for their cooperation in implementing government policies, and recalled the progress made since the financial meltdown of 2013.

“Let me assure you that today’s effort with regard to the banking system does not aim at returning to old practices,” he said.

“The aim is to establish a new, more credible banking system.”

On the economy’s main challenge – non-performing loans – Georgiades said that returning to growth is key in addressing the issue. Other than that, most of the tools necessary to deal with the issue have been adopted, he added, including the insolvency and foreclosure frameworks, the operation of the Financial Ombudsman’s office, and settling the issue of title deeds.

“The only other tool that could be introduced is an asset-management company, which would take advantage of the new legislation and buy loans from banks itself,” he said.

“The option is being examined, but the main deterrent is its funding.”

One of the goals of the immediate future is computerisation of the Taxation Department, while the new tools made available to the taxman have already started being utilised.

“The first sums of unpaid taxes have already been earmarked in bank accounts, to the tune of approximately €1 million,” he said.

“With regard to the Lagarde List, systematic and quiet work is ongoing, and what I can tell you is that identification of account holders has been concluded. The list comprises 361 accounts, with total deposits in 2005-06 of €827 million, of which €200 million belongs to people outside Cyprus. For the remaining cases, taxation will start to be imposed by the end of this month.”

The finance minister repeated his controversial view that the Troika is “neither a blessing, nor a curse”.

“To this day I have not tried to hide behind the Troika, by suggesting that our financial policy was forced upon us by our borrowers,” he said.

“Fiscal consolidation and reforms have been things that our country needed, and they remain so.”

Expressing optimism for the economy’s growth prospects, Georgiades said he is certain the required consensus and understanding to “move forward”, but could not resist a provocative barb against political adversaries.

“If there is one thing that concerns me, it is the anti-reform and populist DNA unfortunately found in some,” he said.

“They will be met with our resistance.”


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