Tax Amnesty Flounders in Spain
December 3, 2012 Taxation in Spain
MADRID – Spain’s latest tax amnesty scheme has ended on a disappointing note, not even reaching half of its revenue target.
On December 3rd the Ministry of Finance of Spain released a statement announcing that its recent tax amnesty program has raised an additional EUR 1.19 billion in tax revenues for the debt stricken country, with participants declaring an average of EUR 37 800 of previously hidden assets and incomes each.
The tax amnesty program ran from June to November this year, and allowed Spanish taxpayers to officially disclose information about their undeclared assets to tax authorities in exchange for paying a reduced tax rate of only 10 percent on the previous five years of hidden income.
Taxpayers who took advantage of the amnesty program were also provided protection from criminal penalty or prosecution for their involvement in tax evasion.
Despite the extra revenues gathered through the program, the government is still being criticised for the tax amnesty scheme, as it did not reach its target of EUR 2.5 billion.
The amnesty also faced significant opposition from the Spanish public, as it offered reduced tax rates for tax evaders, while the government hiked the taxes and instated spending cuts as part of its ongoing austerity programs.
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