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Our View: The Ukraine war as an excuse to extend tax return deadline is absurd

The inland revenue offices in Nicosia (file photo)

When it comes to thinking up excuses for delaying the submission of tax returns deputies are very resourceful and imaginative. On Monday, Diko deputy Panicos Leonidou tabled two bills that would put back the deadline for submitting tax returns by four months to the end of July of this year because of the Ukraine crisis.

The surprising thing is that the bill is not referring to the tax returns for 2021, but those of 2020, which in a normal country would have been submitted last year. A senior finance ministry official said that the initial extension given – from beginning of 2021 to March 2022 – was one of the longest periods anywhere in Europe.

With the passage of the bills, which is a certainty given parties’ commitment to messing with state rules, the extension would become even longer. The first extension was because of the coronavirus which had disrupted business with staff absences. Now, it is the turn of the war in Ukraine to wreak havoc with businesses, although the arguments used and embraced by stakeholders are not very convincing.

The Institute of Certified Public Accountants said the extension would make it easier for audit offices to contact Russian and Ukrainian clients who reportedly were not responding to their requests. Had all audit offices left getting in touch with their clients about the submission of tax returns for 2020, despite knowing for more than a year now that the deadline was March 31, 2022, until after February 24 when Russia invaded Ukraine? Had none of them prepared the tax returns of their clients before the end of February and fell victim to the disruption caused by the war?

It gets more ludicrous. The accountants’ representative said the €100 penalty for missing the deadline would have a negative impact on Cyprus’ image among clients of these countries. Would the owner of a company dealing with millions of euros, and which pays its auditors tens of thousands of euros in fees every year, even notice that the company was charged a €100 fine for a late tax return submission?

The Cyprus Chamber of Commerce (Keve) also came up with some pitiful excuses for demanding the extension – work from home, absence from work because of illness or because of being a Covid contact had disrupted the operation of businesses and prevented them from preparing their tax returns on time. Could these companies not afford the €100 penalty? Was the €100 fine such a threat to the survival of businesses that bills had to be passed extending the deadline?

This is just a case of deputies tinkering with tax collection by the state for no rational reason, other than that they have the power to do so. And we should not be surprised if come July the deadline is extended again, for some reason or other.

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