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Cyprus

Tax department was ‘like a coffee shop’ of gossips, chief says  

Some 30,000 appeals dating back to the 1980s were still outstanding last February, Tax Commissioner Yiannis Tsangaris said on Thursday, likening the situation to the mythological Augean Stables, which had not been cleaned for years.

On top of that, Tsangaris told the House watchdog committee, 5,000 capital statements and 4,000 tax certifications of companies awaiting liquidation were also pending.

So far, the department has processed 60 per cent of the appeals, expecting to reach 80 per cent by year-end. After that, the department will start auditing state officials.

Tsangaris described a sorry state of affairs in the department when he took over, with superiors giving their subordinates cases to handle, and they in turn arbitrarily taxing people for dues of €100. That usually prompted an appeal, triggering an audit of the taxpayer’s last 12 years.

The number of cases ballooned, resulting in zero audits on state officials.

Tsangaris said the department was like a “coffee shop” with workers trawling taxpayer statements and making comments on them. Others also leaked information to MPs and the media.

The commissioner said people without authorisation should not be able to access information, voicing his willingness to turn the department into a trustworthy unit.

Tsangaris submitted to the committee the list with the 100 biggest tax debtors, which included individuals and organisations.

Highlighting the delays in the department, Auditor-general Odysseas Michaelides told MPs of the case of a police officer who acquired immovable property under suspicious circumstances. The response from the department when asked to investigate was there is no time.

Michaelides said the department has been given all the tools to do its job effectively. He also voiced his disagreement with the practice of tax amnesty because, given regularly, it encouraged taxpayers not to pay since the state at some point would ask for less just to collect some cash.

AKEL MP Irini Charalambidou said the department was currently been investigated for cases concerning millions it had come to an arrangement over in the past.

She wondered why all the authority for retroactive audits was concentrated in the hands of the tax commissioner only, a practice that was highly dangerous.

 

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